Action Plans for Residential Mortgage Servicing and Foreclosure Deficiencies

On February 27, the Fed released action plans from Bank of America, Citigroup, EverBank, JPMorgan Chase, MetLife, PNC, SunTrust, US Bancorp, and Wells Fargo to correct deficiencies in residential mortgage loan servicing and foreclosure processing.  The action plans are required by prior Fed enforcement actions that direct regulated mortgage loan servicers to submit acceptable plans that, among other things: (i) describe how communications with borrowers will be strengthened; (ii) establish limits on foreclosures where loan modifications have been approved; (iii) establish third-party vendor controls; and (iv) strengthen compliance programs.  The enforcement actions also require the parent holding companies of servicers to submit plans to describe how the companies will improve servicing and foreclosure oversight.  The Fed also released engagement letters between supervised financial institutions and independent consultants retained to review foreclosures in 2009 and 2010.  Fed Release.  Action Plans and Engagement Letters.