The Consumer Financial Protection Bureau’s (CFPB) examination teams are focusing most of their attention on large bank and nonbank mortgage servicers, according to a top official at the agency.
Based on the risk to consumers, CFPB has prioritized its attention on mortgage servicing, payday lenders and credit card add-on products, said Steve Antonakes, CFPB’s chief of supervision and examination.
“Mortgage servicing has been one area that has been historically under-invested,” the CFPB associate director said at an American Institute of Certified Public Accountants conference Monday afternoon.
Antonakes noted that many consumers have not had the “best results in trying to work out modifications or other alternatives to foreclosure.”
He said that CFPB examiners are looking at specific practices that are occurring, but didn’t elaborate much. “We have some specific concerns.”
CFPB’s chief supervisory officer noted that the servicing and foreclosure settlements that the five mega-servicers reached with the state attorneys general is influencing the examinations.
“We expect a certain level of compliance on the heels of nationwide settlement,” Antonakes said.
However, the former Massachusetts bank commissioner stressed that his examiners understand that there is a “tremendous amount of variation” in the way servicers work with their consumers.
Large commercial banks tend to control the receivables markets, but smaller nonbanks are beginning to make inroads as depositories shed MSRs.