Last month, federal banking regulators settled allegations of criminal conduct with the nation's largest banks. That settlement was criticized by our San Bernardino County foreclosure defense lawyers and other consumer advocates, because the settlement fell short of a parallel proposal by state attorneys general yet threatened to undermine it. Now, just a few weeks later, the Government Accountability Office has released a report criticizing the same group of regulators for failing to find and stop the gross mishandling of foreclosure paperwork at major lenders. The report called on the brand-new Consumer Financial Protection Bureau, which will have exclusive jurisdiction over mortgages, to do a better job when it opens this July.
The GAO reviewed the actions of banking and financial industry regulators including the Federal Reserve, the Office of the Comptroller of the Currency, the Office of Thrift Supervision and the SEC, as well as other federal agencies. It found that banking regulators didn't catch robo-signing because they didn't see mortgage lending practices as risky banking practices, and foreclosure is governed by state laws. Furthermore, some loan servicers are not classified as financial institutions, thus exempting them from regulation. The CFPB will oversee servicers and all other parts of the mortgage industry, but the report said it was not clear whether the bureau would have rules in place to solve these oversight problems. Among other things, the GAO recommended including paperwork standards in upcoming mortgage servicing standards.
As Long Beach foreclosure defense attorneys, we're pleased that the report advocates for stronger regulation of the mortgage industry. That regulation is frequently blocked for political reasons by members of Congress, especially but not exclusively Republicans. In fact, CFPB interim head Elizabeth Warren has had to fight Congressional attempts to limit the bureau's power, including its power to regulate loan servicers. We believe the robo-signing scandal and the housing crisis that preceded it both show a very real need for oversight of the housing industry. The financial industry, like all businesses, wants to make money -- and without oversight, it will be free to continue doing so by cutting corners and exploiting consumers with limited understanding of the process.
Howard Law PC helps homeowners fight back when they have been mistreated or exploited by lenders and loan servicers. Based in Anaheim, we handle loan modification negotiations and predatory lending cases for people across California. Right now, our San Juan Capistrano foreclosure defense lawyers are seeing especially large numbers of cases of wrongful denials under HAMP, the federal loan modification program. Lenders may not deny loan modifications, or decline to make temporary modifications permanent, if borrowers meet well-defined standards. We also handle a lot of cases of foreclosures made in violation of California law, because the lender didn't wait to even discuss alternatives to foreclosure before foreclosing. In all of these cases, we can sue right away to stop a pending foreclosure sale.'
If your home is in default or foreclosure, or will be soon, and your loan servicer has been nothing but unhelpful, don't wait to call Howard Law for help. For a free consultation, you can send us an email or call today at 1-800-872-5925.