CFPB looks to spur automated mortgage refinancing, forbearance

The Consumer Financial Protection Bureau requested feedback on ways to spur new mortgage products that streamline and automate loan refinancing.

Details: The request seeks information on:

• Targeted and streamlined refinance programs that lower monthly payments and interest rates for homeowners who are unlikely or unable to refinance.

• Innovative refinancing products that automatically reduce a loan’s interest rate in certain circumstances.

• Mortgage products with automatic forbearance for borrowers affected by natural disasters or other events.

Rising Rates: The CFPB acknowledged that refinancing volume has dropped nearly 70% from last year amid rising interest rates, so its effort is designed to help homebuyers benefit from the next interest rate drop. The agency earlier this week released a study on the slowdown in loan refinancing.

Deadline: Comments are due 60 days after the request for information is published in the Federal Register. ICBA will submit comments on the notice.