State regulators are joining together in the launch of a mortgage servicing rights task force to help develop options and standards for non-bank mortgage servicers.
In recent years, non-bank mortgage servicers have grown in number, following the housing crisis and retreat of some banks from the business of mortgage servicing. Non-depository institutions performing servicing functions have come under scrutiny of late from federal and state regulators pointing to unsound practices across the mortgage servicing landscape.
The task force — which comprises state regulators including banking and finance departments as well as commerce regulators — will analyze growth of the market, the market itself and will develop recommendations for prudential standards for non-bank mortgage servicers, the Conference of State Bank Supervisors says. The aim of the task force is to ultimately develop best practices and open dialogue among market participants, federal agencies and others.
“There have been significant changes in mortgage finance following the mortgage crisis,” said CSBS President and CEO John W. Ryan. “As the industry continues to change and policy makers contemplate housing finance reform, it is important we provide an appropriate regulatory framework to instill market confidence and ensure consumer protection.”
Written by Elizabeth Ecker