CFPB shuts down reverse mortgage servicers

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The CFPB’s investigation revealed that Sutherland Global, along with its subsidiaries Sutherland Government Solutions and Sutherland Mortgage Services, and NOVAD Management Consulting, had insufficient resources and staffing to manage up to 150,000 borrowers.

Despite federal requirements for servicers to respond to consumer requests promptly, many borrowers could not contact the loan servicing operation. The companies systematically failed to respond to thousands of homeowner requests for critical information, causing significant financial and emotional distress.

This led to systematic failures in responding to homeowner requests for assistance, which resulted in borrowers losing out on home sales, incurring unnecessary costs, and fearing foreclosure, it said.

Read next: Reverse mortgages gaining favor among retirees – survey

CFPB said the companies failed to communicate effectively with homeowners, stopping them from obtaining important information such as loan payoff statements and alternatives to foreclosure. The companies also falsely told homeowners they were in default, leading to further confusion and distress.

https://www.highcpmgate.com/f0c2i8ki?key=d7778888e3d5721fde608bfdb62fd997

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