CFPB Supervisory Highlights on Mortgage Servicing

The CFPB recently issued its Spring 2024 Supervisory Highlights on mortgage servicing, with a focus on purported “junk” fees charged by mortgage servicers.  The Bureau has made findings in supervisory examinations that some servicers committed Unfair Deceptive or Abusive Acts of Practices (UDAAPs) by assessing what the Bureau calls “junk” fees, including allegedly unnecessary property inspection fees and improper late fees.

The Supervisory Highlights focus on four categories of “junk” fees from recent servicing examinations:  1) charges for property inspections on Fannie Mae loans in circumstances where the Bureau contended the underlying inspections were prohibited by Fannie Mae guidelines; 2) late fees that either exceeded the amount of late fees allowed under the note or were assessed against consumers with active loss mitigation agreements; and 3) failing to waive existing fees against borrowers with COVID-19 loan modification agreements in place.  Additionally, the Bureau found that some servicers failed to provide descriptions of the purposes of fees charged.