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Adding new mortgage servicer guidelines to lender risk-retention guidelines now in development “runs the risk of giving short-shrift to two highly complex and critically important issues,” MBA President John Courson wrote in a letter to regulators Monday.   Courson expressed concerns over adding an additional issue to the risk retention guidelines just as that process is drawing toward a conclusion, saying the timely finalization of such rules are needed for investors to return to the housing market.    “This issue is challenging enough in its own right,” he wrote. “We think it would be a mistake to add a second highly complex topic like national servicing standards into the same policymaking process.”   In the wake of the robo-signing foreclosure documentation scandal, there has been growing pressure to establish national standards for mortgage servicers, rules for how they handle consumers’ mortgages and procedures to be followed in foreclosures. The Federal Deposit Insurance Corporation (FDIC) in particular has been pressing for such rules to be included as part of risk-retention requirements for lenders now in development.   The key part of the risk-retention rules, which are required under Section 941 of the Dodd-Frank Act, is that lenders will be required to maintain a 5 percent interest in most mortgages they issue. During the housing bubble, many lenders grew careless about the mortgages they issued because they could sell off the debt – and risk – to investors. It’s thought that requiring them to keep some “skin in the game” will make them more careful about who they lend to.   The recent emergence of the robo-signing scandal, in which it turned out mortgage servicers were routinely rushing through thousands of foreclosures with inadequate documentation, has led to calls for mortgage servicer reforms. The MBA says it supports such reforms, but says they are still in a conceptual stage, and will need time to work out their implications. Meanwhile, it urges that the risk retention rules move forward.

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