CFPB Releases Updated Reverse Mortgage Servicing Examination Procedures

The CFPB recently updated its reverse mortgage servicing examination procedures.  As noted in the CFPB’s announcement, CFPB examiners will use these updated procedures, along with the compliance management system review procedures, to conduct reverse mortgage servicing examinations.

The updated procedures contain new exam questions to address issues raised by consumer complaints and incorporate the HECM regulations that HUD issued in 2017.  The CFPB stated that the new exam questions address, in part, a servicer’s timeliness in giving payoff statements and whether a servicer advanced funds to pay for property taxes in situations where the borrower was not behind on his or her tax payments.  The updated procedures also now include language describing when, under the HECM program, an eligible non-borrowing spouse is able to stay in the home after the borrower dies.