WKFS: Stay Clear of Discriminatory Lending When Modifying Loans

Wolters Kluwer Financial Services, Minneapolis has expanded its loss mitigation offering to include state and federal lending compliance consulting services that help servicers avoid discriminatory lending practices when modifying loans. Servicers can use it to ensure they meet all Home Affordable Modification Program fair lending guidelines recently issued by the Treasury Department, according to the company. WKFS said its compliance consultants are available to evaluate existing loan modification policies and procedures and help servicers address fair lending risks, review a sample of completed loan modifications the servicer has completed and denied, and conduct a statistical analysis of all completed modifications to identify modification criteria that might lead the servicer to violate fair lending laws. While modifying loans at risk of default as quickly as possible, servicers also need to make sure everyone is treated fairly and equally in the process, said WKFS senior consultant and statistician Don Morrow. Moreover, regulators are expected to "intensify their scrutiny of servicers' fair lending compliance," he said.