The Shopper Monetary Safety Bureau on Thursday issued a request for data that would pave the best way for extra equitable entry to mortgage refinancing and distressed borrower help.
Potential outcomes may embrace extending pandemic loss mitigation choices like forbearance for everlasting use.
“The bureau is requesting touch upon the actions it or others can take or ought to take into account taking to spur automated and streamlined brief and long-term loss mitigation affords for debtors with mortgages impacted by momentary monetary hardship extra typically,” the RFI states.
As well as, the RFI is geared toward discovering methods to scale back challenges within the small-loan mortgage market that analysis signifies have contributed to inequitable entry to refinancing for Black and Hispanic debtors with affordability constraints.
The CFPB is contemplating additional streamlining of refinances, probably by means of some exemptions from underwriting necessities beneath the flexibility to repay rule.
“Some stakeholders have asserted that it could be acceptable [in circumstances in] which debtors would obtain a demonstrated profit [such as lower rates or] month-to-month funds, and the place different protections are in place, similar to protections towards serial refinances,” the RFI famous.
The CFPB is also exploring the opportunity of automated refinances beneath specific situations, acknowledging that whereas this will likely have some shopper advantages, it additionally may create financial challenges in a mortgage market the place prepayments have an effect on what loans are value.
“The bureau notes that there could also be impediments or dangers related to the auto-refi mortgage if shoppers lack consolation with the idea or collectors discover it tough to cost,” Director Rohit Chopra mentioned within the RFI.
The CFPB will probably be accepting feedback in response to its request for 60 days as soon as it’s formally printed within the Federal Register.