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BUREAU OF CONSUMER FINANCIAL PROTECTION

PAPERWORK REDUCTION ACT SUBMISSION

INFORMATION COLLECTION REQUEST

SUPPORTING STATEMENT PART A

MORTGAGE ASSISTANCE RELIEF SERVICES 

(REGULATION O) 12 CFR PART 1015

(OMB CONTROL NUMBER: 3170-0007)

OMB TERMS OF CLEARANCE:

Not applicable. The Office of Management and Budget (OMB) did not provide Terms of 

Clearance when they last approved this information collection on July 6, 2012.

ABSTRACT: 

The required disclosures under Regulation O 12 CFR 1015 assist prospective purchasers 

of Mortgage assistance relief services (MARS) in making well-informed decisions and avoiding 

deceptive and unfair acts and practices. The information that must be kept under Regulation O's 

recordkeeping requirements is used by the Consumer Financial Protection Bureau (CFPB) and 

the Federal Trade Commission (FTC) for enforcement purposes and to ensure compliance by 

MARS providers with Regulation O. The information is requested only on a case-by-case basis.

A. JUSTIFICATION

1. Circumstances Necessitating the Data Collection

The Mortgage Assistance Relief Service Rule was created under section 626 of the 2009 

Omnibus Appropriations Act, Pub. L. No. 111-8, published as the MARS rule under 16 CFR 

322, and clarified by section 511 of the Credit Card Accountability and Responsibility and 

Disclosure Act of 2009, Pub. L. No. 111-24 (Credit CARD Act). The Dodd-Frank act (Pub. L. 

111-203, Sec. 1097) transfers rulemaking authority and shared enforcement authority to the 

CFPB under 12 CFR 1015. This rule covers Mortgage Assistance Relief Service providers, 

which are for-profit services which assist consumers who are struggling to meet mortgage 

obligations and/or avoid foreclosure. 

Disclosure requirements 

In commercial communications for a general audience, MARS providers are required to 

make the following disclosure: 

(1) “(Name of company) is not associated with the government and our service is not 

approved by the government or your lender”; and 
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(2) in some instances, that “[e]ven if you accept this offer and use our service, your 

lender may not agree to change your loan.” 

In addition, MARS providers must disclose to consumers, in any subsequent commercial 

communication directed to a specific consumer, the following information: 

(1) that “You may stop doing business with us at any time. You may accept or reject the 

offer of mortgage assistance we obtain from your lender [or servicer]. If you reject the 

offer, you do not have to pay us. If you accept the offer, you will have to pay us (insert 

amount or method for calculating the amount) for our services”; 

(2) that “(Name of company) is not associated with the government and our service is not 

approved by the government or your lender”; and 

(3) in some instances, that “[e]ven if you accept this offer and use our service, your 

lender may not agree to change your loan.” 

Furthermore, MARS providers are required to disclose to consumers in all 

communications in which the provider represents that the consumer should temporarily or 

permanently discontinue payments, in whole or in part, the following information:

“If you stop paying your mortgage, you could lose your home and damage your credit 

rating.” 

Finally, after a provider has obtained an offer of mortgage assistance relief from the 

lender or servicer and presented the consumer with a written agreement incorporating the offer, 

the MARS provider must disclose the following: 

(1) “This is an offer of mortgage assistance relief service from your lender [or servicer]. 

You may accept or reject the offer. If you accept the offer, you will have to pay us [same 

amount as disclosed pursuant to § 1015.4(b)(1)] for our services”; and 

(2) a description of all “material differences” between the terms, conditions, and 

limitations of the consumer’s current mortgage and those associated with the offer for 

mortgage relief, provided in a written notice from the consumer’s lender or servicer. 

Regulation O also requires making the disclosures clear and prominent, specific to the 

media used. Disclosures are necessary for the following reasons: 

• Non-affiliation with the government or lenders: The CFPB, FTC and state law 

enforcement officials have brought numerous law enforcement actions against MARS 

providers who have misrepresented their affiliation with government agencies or 

programs, lenders, or servicers, in connection with offering MARS. These providers 

have used a variety of techniques to create such misimpressions, including advertising 

under trade names that resemble the names of legitimate government programs. Given 

that the government, for-profit entities, and nonprofit entities assist financially distressed 

consumers with their mortgages, and allowing for the frequency of deceptive affiliation 

claims, the requirement that MARS providers disclose their nonaffiliation with the 
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government or with consumers’ lenders or servicers is reasonably related to the goal of 

preventing deception.

• Risk of Nonpayment of Mortgage: There have been numerous cases where MARS 

providers frequently encourage consumers, often through deception, to stop paying their 

mortgages and instead pay providers. Consumers who rely on these deceptive statements 

frequently suffer grave financial harm. Requiring MARS providers who encourage 

consumers not to pay their mortgages to disclose the risks of following this advice is 

necessary to prevent deception. 

• Total amount a consumer must pay: The total cost of mortgage assistance relief services 

is perhaps most material to consumers in making well-informed decisions on whether to 

purchase those services. Requiring the clear and prominent disclosure of total cost 

information in every communication directed at a specific consumer before the consumer 

enters into an agreement would decrease the likelihood that MARS providers will deceive 

prospective customers with incomplete, inaccurate, or confusing cost information. 

Requiring MARS providers to disclose total cost information clearly and prominently is 

reasonably related to the prevention of deception. 

In addition, Regulation O prohibits providers from collecting fees until the consumer has 

accepted the results obtained by the provider. To effectuate fully the advance fee ban, it also is 

necessary for the provider to inform consumers that they may withdraw from the service and 

may accept or reject the result delivered by the provider. This disclosure is reasonably related to 

preventing unfair and deceptive acts and practices by MARS providers. 

• No guarantee: Historically, MARS providers often misrepresent their likelihood of 

success in obtaining a significant loan modification for consumers. These deceptive 

success claims lead consumers to overestimate MARS providers’ abilities to obtain 

substantial loan modifications or other mortgage relief from MARS providers. Requiring 

MARS providers to inform consumers that lenders might not agree to change consumers’ 

loans, even if those consumers purchase the services that the MARS provider offers, is 

reasonably related to the goal of preventing deception.

• Written Notice from Lender or Servicer: Based on the CFPB’s and FTC’s law 

enforcement experience, the CFPB believes that providing the consumer with a notice 

from the consumer’s lender or servicer describing all material differences between the 

consumer’s current mortgage loan and the offered mortgage relief is essential to 

consumers’ ability to evaluate whether they should accept the offer. Requiring that the 

lender or servicer prepare the written disclosure also better ensures that the information 

provided is consistent with the terms of the offer, and mitigates against the risk that 

MARS providers would mislead consumers about the offer. This disclosure is reasonably

related to the goal of protecting consumers from the deception. 

Recordkeeping requirements

In some instances, these requirements pertain to records that are customarily kept in the 

ordinary course of business, such as copies of contracts and consumer files containing the name 

and address of the borrower and materially different versions of sales scripts and related 
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promotional materials. Thus, the retention of these documents does not constitute a “collection 

of information,” as defined by OMB’s regulations that implement the PRA.1

In other instances, the recordkeeping requirements pertain to requiring providers to create 

and retain documents demonstrating their compliance with specific rule requirements. These 

include the requirement that providers document the following activities: 

(1) performing MARS and retaining documentation provided to the consumer; 

(2) monitoring sales presentations by recording and testing oral representations if

engaged in telemarketing of services; 

(3) establishing a procedure for receiving and responding to consumer complaints; 

(4) ascertaining, in some instances, the number and nature of consumer complaints; and 

(5) taking corrective action if sales persons fail to comply with Regulation O, including 

training and disciplining sales persons. 

The information obtained from the law enforcement record establishes the need for these 

recordkeeping requirements. There appears to be widespread deception and unfair practices in 

the MARS industry, targeting financially vulnerable consumers. Accordingly, strong 

recordkeeping requirements are needed to ensure effective and efficient enforcement of 

Regulation O and to identify injured consumers. 

2. Use of the Information

The required disclosures under Regulation O assist prospective purchasers of MARS in

making well-informed decisions and avoiding deceptive and unfair acts and practices. 

The information that must be kept under Regulation O’s recordkeeping requirements is 

used by the CFPB and other relevant agencies for enforcement purposes and to ensure 

compliance by MARS providers with Regulation O. The information is requested only on a 

case-by-case basis. 

3. Use of Information Technology

The disclosures required by Regulation O are format-neutral and do not limit MARS 

providers’ use of available information technology that might reduce compliance burdens. 

Likewise, Regulation O’s recordkeeping provisions do not limit the use of available technology 

to maintain required records. Rather, Regulation O specifically allows providers to keep the 

records in any form and in the same manner, format, or place as they keep records in the ordinary 

course of business. Thus, Regulation O is consistent with the aims of the Government 

Paperwork Elimination Act, 44 U.S.C. § 3504. 

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5 CFR 1320.3(b)(2).
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4. Efforts to Identify Duplication

The disclosure and recordkeeping provisions in Regulation O do not duplicate any other 

federal information collection requirements. The CFPB is unaware of any duplicative state 

requirements. 

5. Efforts to Minimize Burdens on Small Entities 

Regulation O attempts to minimize compliance burdens for all entities. Inasmuch as the 

population of affected providers likely consists largely of small entities, exemptions based on 

size would undermine the protective aims of Regulation O.

6. Consequences of Less Frequent Collection and Obstacles to Burden Reduction

Providing the disclosures required by Regulation O less frequently would undermine the 

protective aims of the rule. As a threshold matter, it is important that consumers know before 

they begin dealing with MARS providers: (1) that MARS providers are not associated with the 

government or with consumers’ lenders; and (2) that regardless of the service or result the 

MARS providers represent the consumer will receive by using their services, the lender may not 

agree to change the consumer’s loan. Thus, it is necessary that these disclosures be made in all 

communications with consumers prior to consumers entering into an agreement to purchase 

MARS. In addition, these disclosures, along with the disclosure of total cost and the right to 

cancel the service at any time, are needed in each subsequent commercial communication with 

specific consumers to increase the chances that consumers will read and understand the required 

information. Furthermore, the disclosure to the consumer regarding the risk of failing to pay his 

or her mortgage is necessary in all communications in which the triggering statement is made 

given the harm that could result from following such advice. These requirements will prevent 

MARS providers from disclaiming, qualifying, or contradicting disclosures in subsequent 

statements to consumers during telemarketing calls or e-mail communications. Enforcement 

experience indicates that this practice of contradictory statements by MARS providers is 

common. 

Regulation O also is tailored to minimize the frequency of recordkeeping as much as 

possible. The rule requires that MARS providers maintain records relating to actual transactions 

with customers; they are not required to keep records when consumers do not sign contracts or 

do not agree to an offer. In addition, providers would only be required to retain materially 

different versions of advertising and related materials. Further, the CFPB’s and FTC’s record 

supports the conclusion that the two-year retention requirement is the minimum amount of time 

necessary for consumers to report violations of Regulation O and for the CFPB to complete 

investigations and to identify victims. 
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7. Circumstances Requiring Special Information Collection

The collections of information in Regulation O are consistent with the applicable 

guidelines contained in 5 CFR 1320.5(d)(2). 

8. Consultation Outside the Agency

We have consulted with the FTC and industry experts to gather information relating to 

the burdens of MARS and Regulation O. In addition, in accordance with 5 CFR §1320.8(d)(1), 

the Bureau has published a notice Federal Register allowing the public 60 days to comment on 

this proposed the extension (renewal) of this currently approved collection of information. 

Further and in accordance with 5 CFR §1320.5(a)(1)(iv), the Bureau will also publish a notice in 

the Federal Register allowing the public 30 days to comment on the submission of this 

information collection request to the Office of Management and Budget.

9. Payments or Gifts to Respondents

No payments or gifts are provided to respondents.

10. Assurances of Confidentiality

To the extent that information covered by a recordkeeping requirement is collected by the 

CFPB for law enforcement purposes, the confidentiality provisions of CFPB’s rules on 

Disclosure of Records and Information, 12 CFR Part 1070, would apply. 

11. Justification for Sensitive Questions

The CFPB collects no information under Regulation O, which requires institutions to 

provide general and transaction-specific disclosures to consumers and keep records of those 

disclosures, as well as records of contracts and communication with consumers. No questions of 

a sensitive nature are asked of respondents.
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12. Estimated Burden of Information Collection

Labor Hours: 322

Exhibit 1: Burden Hour Summary

CFPB’s estimate of the burden for the ongoing recordkeeping requirement under 

Regulation O is based on a new analysis conducted after the regulation was restated by the 

CFPB. For PRA purposes regarding regulation O, the CFPB and FTC share enforcement 

authority and thus split the PRA burden associated with affected entities.

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 This burden amounts 

to 642 hours total, of which 321 hours are attributed to the CFPB.

The CFPB estimates that there are 107 MARS providers in the United States, and no 

new entrants to the market.

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 The CFPB also estimates that compliance with all required

MARS disclosures requires 6 hours of labor annually. Distributing these costs equally 

across the required disclosures and multiplying by 107 entities yields a total burden of 645

hours total, of which 322 hours are attributed to the CFPB.

 2 Under Dodd-Frank Act, the CFPB shares with the FTC half of the burden imposed non-depository institutions. 3 Estimates are based on available data, which is limited. Nevertheless, California has a public listing of registered 

MARS providers (see the California Attorney General’s “Stop Mortgage Fraud” list of registered loan modification 

providers), and assuming providers are spread out across the United States at similar proportions to the general 

population, we estimate the number of registered MARS providers in California to be approximately 107 for-profit 

non-attorney entities performing loan modification.

Regulation Description

No. of 

Respondents

Annual Burden 

Hours per 

Respondent

Hourly 

Rate

Total 

Burden 

Hours

Associated 

Labor Cost

1015.4(a)

General Commercial 

Communications Disclosure

107 1.2 $ 30.93 129 $ 3,971

1015.4(b)

Consumer-Specific 

Communications Disclosure(s)

107 1.2 $ 30.93 129 $ 3,971

1015.4(c)

Contingent Consumer-Specific 

Disclosure(s)

107 1.2 $ 30.93 129 $ 3,971

1015.5 (b) & 

(c)

Additional Contingent 

Consumer-Specific 

Disclosure(s)

107 1.2 $ 30.93 129 $ 3,971

1015.5(d)

Additional Contingent 

Consumer-Specific 

Disclosure(s) for trial loan 

modifications

107 1.2 $ 30.93 129 $ 3,971

1015.9 Recordkeeping 107 0 $ - 0 $ -

Total Labor Burden 107 6 $ 30.93 645 $ 19,855

CFPB Share 322 $ 9,928

Ongoing Labor Burden
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Associated Labor costs: $9,929

To calculate associated labor costs the CFPB assumes a wage of $30.93/hr.

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Multiplying this wage by the total burden yields an associated labor cost of $19,510.38, of 

which the CFPB assumes half, or $9,755.19.

13. Estimated Total Annual Cost Burden to Respondents or Recordkeepers

Additional Material Burden: $29,425

Exhibit 2: Cost Burden Summary

The CFPB does not believe there is any additional burden imposed by the recordkeeping 

requirement in 5 CFR 1015.9.5

 The CFPB does estimate that each MARS provider bears an 

additional $550 in material fees6 for acquiring relevant legal and technical compliance 

information. Across all 107 respondents the total additional material burden is $58,850, of 

which the CFPB assumes half, or $29,425.

14. Estimated Cost to the Federal Government

As the CFPB does not collect any information, the cost to the CFPB is negligible.

 4 See BLS Occupational Employment and Wages estimate of the median hourly wage for a Compliance Officer 

(occupation code 13-1041) of $30.93. 5 CFPB assumes that MARS providers keep records of all customer communications in the ordinary course of 

business. This assumption is based on conversations with industry and supervision personnel. 

6 $550 is the estimated cost for the purchase of information regarding regulatory updates from law offices or trade 

associations. 

Burden Type

No. of 

Respondents Per Unit Cost

Quantity per 

Respondent Total material cost

Additional Compliance Support 107 $550 1 $58,850

Total Labor Burden $58,850

CFPB Share $29,425

Ongoing Material Burden
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15. Program Changes or Adjustments

Exhibit 3: Summary of Burden Changes

Total 

Respondents

Annual 

Responses

Burden Hours Cost Burden

Total Annual Burden

Requested

107 107 322 $ 29,425

Current OMB 

Inventory

250 1000 32,500 0

Difference (+/-) -97 -893 -32,178 $ 29,425

Program Change 0 0 0 $0

Discretionary 0 0 0 $0

New Statute 0 0 0 $0

Violation 0 0 0 $0

Adjustment -393 -393 -32,178 $29,425

Prior to this analysis, the CFPB and FTC’s ongoing burden for Regulation O was 

approximately 65,000 hours annually, of which one half, 32,500 hours, were allocated to the 

CFPB. The drop in burden hours reflects a significant reduction in the estimated MARS 

providers and the lack of one-time startup costs associated with new entrants into the market

(due to the fact that there are not expected to be any new market entrants in the next three 

years), as well as the lack of rule modification and regulatory litigation related to nonattorney MARS providers. The decrease in the estimated number of MARS providers is 

consistent with this regulation causing a reduction in apparent providers of mortgage relief 

services, who were not in fact providing legitimate relief services. These providers were 

sometimes mistaken for legitimate MARS providers (causing overestimation) 

16. Plans for Tabulation, Statistical Analysis, and Publication

There are no plans to provide any publications based on the information collection of this 

regulation.

17. Display of Expiration Date

The OMB control number and expiration date associated with this PRA submission will 

be displayed on the Federal government’s electronic PRA docket at www.reginfo.gov, as well as 

in the Code of Federal Regulations. There are no required forms or other documents upon 

which display of the control number and expiration date would be appropriate
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18. Exceptions to the Certification Requirement

The Bureau certifies that this collection of information is consistent with the requirements 

of 5 CFR 1320.9, and the related provisions of 5 CFR 1320.8(b)(3) and is not seeking an 

exemption to these certification requirements.