WASHINGTON - The Federal Reserve Board said on Monday it approved an interim final rule requiring that consumers be notified when their mortgage loan has been sold or transferred.
The new rule complies with and aims to reinforce a provision in housing support legislation passed by Congress in May that aimed to make homeowners more aware of the ownership of their mortgage, the Fed said in a statement.
As the housing crisis deepened, many borrowers had difficulty determining who owned their mortgage and who to contact with questions, problems or complaints about their loans, particularly for modification requests.
The legislation in May began requiring mortgage purchasers or assignees to notify homeowners in writing within 30 days of acquiring their loan.
The Fed said it was implementing changes to Regulation Z, its rule for Truth in Lending Act disclosures, to provide compliance guidance and greater certainty on the new requirements.
The Fed said it is making compliance with the new Fed rule optional for 60 days to allow time for operational changes by lenders and investors. It said it would solicit comments for 60 days before deciding on a permanent rule, but said the mortgage purchasers or assignees were still subject to the requirements of the federal statute. (Reporting by David Lawder; Editing by Andrea Ricci)