‘‘(ii) HONORING
OF
EXISTING
LOAN 
MODIFICATIONS
AND
APPLICATIONS
IN 
PROCESS.—The successor servicer shall 
agree to honor and accept any existing 
loan modification and continue any loan 
modification applications. 
‘‘(iii) 
PROHIBITION
ON
FORE-
CLOSURE.—During the 60-day period be-
ginning on the effective date of transfer of 
the servicing of any federally related mort-
gage loan, the mortgage loan subject to 
such transfer may not be subject to initi-
ation of a judicial or nonjudicial fore-
closure or be subject to a foreclosure sale. 
‘‘(4) SUBSEQUENT APPLICATIONS FOR AFFORD-
ABLE LOAN MODIFICATION.—If a borrower has sub-
mitted an application or request in the past, the 
servicer shall allow such borrower to make a subse-
quent affordable loan modification application if the 
borrower experiences a material change in cir-
cumstances, as defined by the Bureau. 
‘‘(5) LIMITATION
ON
FORECLOSURE
PRO-
CEEDINGS.— 
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‘‘(A) HALT TO FORECLOSURE AND CAN-
CELLATION OF SCHEDULED SALE PENDING AP-
PLICATION.— 
‘‘(i) IN GENERAL.—If a borrower sub-
mits an initial application for affordable 
loan modification assistance more than 7 
business days before a scheduled fore-
closure sale, the servicer must stop and 
cancel the foreclosure sale and may not 
continue a nonjudicial foreclosure or a ju-
dicial foreclosure against the mortgagor. 
‘‘(ii) 
TREATMENT
IF
NO
FORE-
CLOSURE HAS BEEN INITIATED.—For pur-
poses of clause (i), if no foreclosure has 
been initiated at the time of a mortgagor’s 
initial application for affordable loan modi-
fication assistance, then an initial applica-
tion is deemed to have been submitted 
more than 7 business days before a sched-
uled foreclosure sale. 
‘‘(iii) TREATMENT IF A FORECLOSURE 
HAS
BEEN
INITIATED
BUT
NO
SALE 
SCHEDULED.—For purposes of clause (i), 
if a foreclosure has been initiated at the 
time of the mortgagor’s initial application 
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for affordable loan modification assistance, 
but a foreclosure sale has not been sched-
uled, then an initial application is deemed 
to have been submitted more than 7 busi-
ness days before a scheduled foreclosure 
sale. 
‘‘(B) FORECLOSURE
PROCEEDINGS
PER-
MITTED.—Notwithstanding subparagraph (A), 
a servicer may initiate or continue a judicial or 
nonjudicial foreclosure under State law against 
a borrower, if— 
‘‘(i) the servicer— 
‘‘(I) determines that the borrower 
is not eligible for a modification; 
‘‘(II) notifies the borrower of the 
determination under subclause (I); 
and 
‘‘(III) provides the borrower— 
‘‘(aa) a copy of any net 
present value calculation made by 
the servicer in relation to an af-
fordable loan modification, in-
cluding any information pro-
viding a basis for such net 
present value calculation; 
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‘‘(bb) a copy of any note, 
deed of trust, or other document 
necessary to establish the right of 
the servicer to foreclose on the 
mortgage, including proof of as-
signment of the mortgage to the 
servicer and the right of the 
servicer to enforce the relevant 
note under the law of the State 
in which the real property secur-
ing the mortgage is located; 
‘‘(cc) a copy of any language 
in the pooling or servicing agree-
ment with respect to the mort-
gage that the servicer relies upon 
in asserting that it is prohibited 
or limited in providing a modi-
fication of the mortgage note; 
‘‘(dd) a copy of all cor-
respondence between the servicer 
and the borrowers and investors 
in which the servicer attempts to 
obtain permission to make a 
modification; and 
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‘‘(ee) the alternatives to 
foreclosure available to the bor-
rower, including deed in lieu of 
foreclosures and short sales; or 
‘‘(ii) a borrower— 
‘‘(I) declines to be considered for 
a loan modification in writing or de-
clines an affordable modification in 
writing; or 
‘‘(II) does not respond to the 
servicer’s outreach activities (as de-
fined by the Bureau) to obtain under-
lying information to complete an ap-
plication or fails to make a trial or 
permanent loan modification payment. 
For purposes of clause (i), a ‘pooling and serv-
icing agreement’ is any contract establishing 
the transaction rights and duties of the parties 
to any mortgage-backed securitization trans-
action. 
‘‘(C) BAR TO FORECLOSURE.—Failure to 
comply with the requirements of this paragraph 
shall be a bar to the foreclosure of a mortgage, 
deed of trust, or substantially similar instru-
ment. 
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‘‘(D) FEES.— 
‘‘(i) WAIVER
OF
LATE
FEES.—If a 
borrower’s application for affordable loan 
modification assistance is accepted, the 
servicer shall waive any foreclosure fees 
and any late fees related to the delin-
quency in payment. 
‘‘(ii) NO FEE ACCRUAL WHILE APPLI-
CATION IS PENDING.—A borrower shall not 
accrue additional late or foreclosure fees 
during the period beginning on the date 
that the borrower submits an affordable 
loan modification application and the date 
on which the servicer makes a determina-
tion on such application. 
‘‘(E) NOTIFICATION.—With respect to a 
foreclosure sale that is postponed by reason of 
this subsection, the servicer shall notify the bor-
rower in writing of such postponement and, if 
a date for such foreclosure sale is rescheduled, 
shall notify the borrower in writing of the new 
foreclosure sale date. 
‘‘(F) CERTIFICATION OF DETERMINATION 
OF ELIGIBILITY REQUIRED FOR SALE.— 
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