PALM HARBOR, Fla.–With the Consumer Financial Protection Bureau having just issued a compliance bulletin and policy guidance titled “Mortgage Servicing Transfers,” one company here is cautioning that nationally as many as 490,000 homeowners could be affected by faulty servicer database records.
The new guidance directly addresses the highlighted concerns that the transferor and transferee in all transactions involving MSR or whole loan sales are jointly and separately responsible for the integrity of the data and documents of all loans involved in the transfer. The CFPB is also putting particular attention on loans involved in residential mortgage servicing transfers with pending loss mitigation activities.
But Nationwide Title Clearing, Inc. said that the mortgage servicing industry needs a quality control methodology with which to validate the data in its servicing systems against collateral file or servicing file images. In an in-house study, NTC said it found that out of 2,285,665 servicing database records that were verified against the collateral file, 24,490 loans (1.07%) had significant discrepancies.
“When viewed against roughly 49 million outstanding residential mortgages as many as 490,000 homeowners could be affected by faulty servicer database records,” the company said.
NTC said it has taken steps to remedy the problems with forensic audit and remediation services wherein the company receives a copy of both the data fields and an imaged copy of the original file, which are then compared to each other—and if there is a discrepancy, it must be resolved before moving forward.