As the US mortgage servicers ramp up their loan modification efforts to help slow the exploding number of home foreclosures, the primary focus is on mitigating financial losses for both the financial institution and borrower. Against this backdrop, Wolters Kluwer Financial Services (WKFS) has expanded its Loss Mitigation Service to include fair lending compliance consulting.
WKFS claimed that its compliance consultants will evaluate a servicer’s loan modification policies and procedures to help determine how they can address fair lending risks thoroughly. They review a representative sample of loan modifications the servicer has completed and denied to determine if any disparate treatment of borrowers exists. And finally, they conduct a statistical analysis of all completed modifications and denied applications, identifying certain modification criteria that might lead the servicer to violate fair lending laws.
WKFS helps servicers ensure compliance with requirements surrounding various loan modification programs, including the government’s Home Affordability Refinance Program (HARP), HAMP and HOPE for Homeowners programs, and meet Freddie Mac, Fannie Mae, Treasury and Department of Housing and Urban Development guidelines, through its expansive library of mortgage compliance documents.
Don Morrow, senior consultant and statistician at Wolters Kluwer Financial Services, said: “While modifying loans at risk of default as quickly as possible is paramount for servicers and their borrowers, so is making sure everyone is treated fairly and equally in the process. Regulators have put forth notice they’ll intensify their scrutiny of servicers’ fair lending compliance.”
Kurt Sames, vice president and general manager of Consumer Compliance at Wolters Kluwer Financial Services, said: “Wolters Kluwer Financial Services’ fair lending compliance experts possess decades of experience analyzing loan data. They have the skills and knowledge necessary to help servicers begin addressing emerging fair lending concerns immediately.”
