Legal Issues

There is no shortage of legal expertise servicing the mortgage banking industry, with numerous networks and associations of attorneys providing guidance to the industry on regulatory compliance, collections, foreclosures, bankruptcies and other issues that come up in the course of servicing loans, both performing and nonperforming. But the legal landscape is constantly evolving. In fact, the changing of the guard in the U.S. Congress and many state Legislatures this past fall illustrates the degree to which attorneys and servicers must keep abreast of new legislative developments. No doubt, the more consumer-friendly bent of this year's Congress will yield new laws that affect the industry.

Whatever the environment, dispute resolution will, unfortunately, lead some mortgage companies into the courtroom. Many rely on legal representation from both general counsel and outside counsel to keep them out of litigation as much as possible. But when circumstances do force lenders into the courtroom, they want the best representation they can find.

With each advance in technology and business processes, new questions emerge about how well the new practices and procedures meet the various legal requirements imposed on lenders. The mortgage industry, just like the rules and regulations that govern mortgage lending, continues to evolve.

Organizations such as the AFN and USFN provide educational resources for lenders as well as for members of their attorney networks. And trade associations like the Mortgage Bankers Association do a great job of looking out for the industry's legal interests in Washington. But their work is never done. With the passing of a torch to a new Congress, new issues will emerge to challenge the industry's compliance rules. That will keep the attorneys - and the companies they represent - busy for a long time to come.

Disputes are inevitable in the home loan industry. What servicers want to focus on is resolving them quickly and efficiently, before they end up in a courtroom. And when they do end up in court, servicers need the best representation they can find. (c) 2007 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com http://www.sourcemedia.com