On July 7, 2025, the Credit and Collection News reported that the CFPB has terminated its consent order against Fay Servicing over alleged illegal foreclosure practices. This cancellation releases Fay Servicing from any alleged noncompliance regarding a 2024 settlement agreement.
On August 21, 2024, the CFPB took action against Fay Servicing for violations of mortgage servicing laws, as well as for violations of a 2017 agency order that addressed its illegal foreclosure practices. According to the CFPB, Fay Servicing took prohibited foreclosure actions against borrowers requesting mortgage assistance, failed to offer borrowers mortgage assistance options available to them, and overcharged for private mortgage insurance. The CFPB ordered Fay Servicing to pay $3 million in consumer redress, invest at least $2 million to update servicing technology and compliance systems, and pay a $2 million fine to the CFPB’s victims relief fund.
The cancellation of the 2024 order was made following Fay Servicing’s payment of $3 million in restitution to affected consumers and a $2 million civil money penalty, although company leadership maintained that it “strongly disagrees with the CFPB’s claims in this matter.” The CFPB confirmed that the $3 million paid by the company will be distributed to affected consumers as part of the August 2024 settlement.
Read the Credit and Collection News’ report here.