The evaluation report released this
morning by the Federal Housing Finance Agency's (FHFA) Office of the Inspector
General (OIG) has triggered a call for a Congressional hearing. The OIG report claimed that servicers
employed by Freddie Mac have not handled the serious category of consumer
complaint termed "escalated" in a timely manner nor reported them correctly to
Freddie Mac. OIG also found significant
deficiencies in the oversight of servicers by Freddie Mac and of Freddie Mac by
FHFA and that no penalties had been imposed on services for failure to conform
to agency and company servicing guidelines.
Congressman Elijah E.
Cummings (D-MD), Ranking Member of the House Committee on Oversight and
Government Reform, sent a letter today to Committee Chairman Darrell Issa
(R-CA) requesting that the Committee hold a
hearing with Edward DeMarco, the Acting FHFA Director,
and Steve A. Linick, the Inspector General of FHFA. Cummings requested that the
Committee also invite representatives from Bank of America, CitiMortgage,
Provident, and Wells Fargo - the mortgage servicers singled out in the
Inspector General's report as having particularly failed to follow FHFA's requirements
for handing and reporting the escalated cases they receive.
"Today's report reveals the latest
in a sorry string of failures by FHFA leadership to protect American
homeowners," said Cummings. "After so many reports documenting the abuses
homeowners have suffered at the hands of mortgage servicers, it is
unconscionable that FHFA has failed to require mortgage servicers to properly
handle tens of thousands of homeowner complaints."
Cummings has had a fraught
relationship with DeMarco for some time, mainly centered around FHFA's refusal
to allow Freddie Mac and Fannie Mae to write down principal balances on
delinquent underwater mortgages.
Cummings recently sent a letter, signed by 44 other Democratic house
members, to President Obama demanding the removal of DeMarco and appointment of
a permanent FHFA director.