Overview
- California Attorney General Rob Bonta joined a bipartisan coalition of 23 attorneys general and several state bank supervisors in a formal letter urging the OCC to drop its escrow proposals.
- The OCC’s December proposals would codify national banks’ authority over mortgage escrow accounts and declare federal preemption of state rules on interest payments and related fees.
- Twelve states, representing roughly 30% of U.S. mortgages, require interest on escrow balances, with California mandating at least 2% annually.
- State supervisors and consumer advocates warn the changes would disadvantage state‑chartered banks and nonbank servicers, reduce price transparency, and raise costs for homeowners.
- The dispute unfolds against the legal backdrop of Cantero v. Bank of America, with courts assessing whether such state laws significantly interfere with national bank powers as the OCC’s rulemaking continues.