On May 11, 2020, the CFPB issued a consent order with Specialized Loan Servicing, LLC. The consent order requires Specialized Loan Servicing, a mortgage-loan servicer in Colorado, to pay $1.275 million in monetary relief to consumers, pay a $250,000 civil money penalty, and implement procedures to ensure compliance with RESPA.
In their release, the CFPB explains that their investigation found that Specialized “violated RESPA and Regulation X by taking prohibited foreclosure actions against mortgage borrowers who were entitled to protection from foreclosure, and by failing to send or to timely send evaluation notices to mortgage borrowers who were entitled to them.” In addition, the CFPB explained that in some cases, Specialized’s violations of Regulation X short-circuited the protections against foreclosure for consumers whose homes were ultimately foreclosed upon.
Under the settlement, the CFPB states that Specialized must implement policies and procedures that will ensure that borrowers receive the protections from foreclosure to which they are entitled under RESPA and Regulation X, including preventing Specialized from improperly making first filings, from improperly moving for foreclosure judgments or orders of sale, and from conducting foreclosure sales against borrowers who have submitted timely and facially complete or complete loss-mitigation applications. The CFPB also explained that Specialized must also monitor its foreclosure activity to ensure that it complies with the policies and procedures that it must implement.
The full consent order can be found here.