No, we do not believe that you would incur any liability for sending the modified periodic statements for consumers in bankruptcy under the CFPB’s amended mortgage servicing rules. The CFPB designed its modified periodic statements to comply with the Bankruptcy Code’s prohibition against contacting borrowers who have filed for bankruptcy and are subject to the automatic stay.

But as your question suggests, your bank also has the option of discontinuing all periodic statements when a mortgage borrower files for bankruptcy, due to your blanket exemption from the periodic statement requirements as a small servicer.

For resources related to our guidance, please see:

• CFPB Final Rule, Amendments to the 2013 Mortgage Rules, 81 Fed. Reg. 72160, 72318 (October 19, 2016) (effective April 19, 2018) (“Congress mandated in the Dodd-Frank Act that consumers receive periodic statements and did not provide a bankruptcy exception. In addition, the 2005 amendments to the Bankruptcy Code provide expressly that a mortgage creditor does not violate the discharge injunction by seeking to obtain periodic payments on a discharged mortgage loan in the ordinary course of its relationship with a consumer in lieu of pursuing foreclosure. A leading bankruptcy treatise interprets these amendments as permitting a servicer to send a periodic statement to a consumer who has used the ride-through option. Both the Dodd-Frank Act and the 2005 amendments to the Bankruptcy Code therefore indicate that Congress contemplated that consumers could receive periodic statements about their mortgage loans notwithstanding the bankruptcy process.”)

• Regulation Z, 12 CFR 1026.41(e)(4) (“A creditor, assignee, or servicer is exempt from the requirements of this section for mortgage loans serviced by a small servicer.”)