OCC issued Supervisory Guidance 2011-29, clarifying the standards expected of national banks and their servicing companies. Among other standards announced, the Guidance provides:
(emphasis added). The complete guidance can be accessed here.
- Management should ensure that foreclosure governance processes are sufficient to manage and control operational, compliance, legal, and reputation risk associated with foreclosure activities. Boards of directors should ensure that management has addressed these areas.
- Borrowers are often confused when a servicer is working with them to modify their mortgage but continues with legal proceedings related to foreclosure. To reduce this confusion, management should suspend foreclosure proceedings for successfully performing trial period modifications where they have the legal ability to do so under servicing contracts.
- Management must ensure that attestations in foreclosure-related affidavits are truthful, accurate, and adequately supported by file documentation, that affiants have sufficiently reviewed the documentation and have adequate knowledge to make the attestations, and that notary practices conform to state legal requirements.
- Management must ensure that all documents required supporting lawful foreclosure actions are maintained and have been properly endorsed or assigned.