CFPB, DOJ Remind Servicers of Veteran, Service Member Rights As COVID Forbearance Ends

With many COVID-19 mortgage forbearance programs winding down, the CFPB and the Department of Justice today sent letters to mortgage servicers reminding them of service member and veteran mortgage borrowers’ rights under federal laws and regulations, including the CARES Act, the Servicemembers Civil Relief Act, Regulation X and Regulation Z.

CFPB and DOJ raised concerns about complaints filed by service members and veterans in recent days, including those related to mortgages in COVID forbearance being reported as delinquent to consumer reporting agencies; incorrect or confusing communications about COVID forbearance; or required lump sum payments for reinstatement.

“Such actions, if true, may be in violation of the legal protections under the CARES Act or contrary to administrative guidance issued by federal housing agencies,” the letter warned. “The CFPB is currently reviewing these complaints to determine if further investigation is warranted.”