Regulations

Browse articles from all of our Newsletters related to Regulations.

December 9, 2016 - IMFnews

What We’re Hearing: Time to Merge HUD and the FHFA? / Short Covering Behind GSE Stock Spike? / The Quandary Over GSE CRT Deals / 387 Days Before Fannie and Freddie Run Out of Capital / New Hires for Tech Vendor

In case you’re not keeping tally, there are roughly 387 calendar days remaining before the “capital buffer” at Fannie and Freddie falls to zero on Jan. 1, 2018.


December 9, 2016 - IMFnews

SFIG Members Cite Progress on Non-Agency MBS Reform Effort; But More Work Ahead, Much More…

“That’s a lot of work for an industry that apparently doesn’t exist,” said Richard Johns, SFIG’s executive director.


December 9, 2016 - Inside MBS & ABS

With Coming Change in Executive Branch, Analysts Assess Regulatory Regime Imposed After the Financial Crisis

With November’s election potentially unraveling key features of the financial regulatory structure instituted over the past eight years, experts say it’s time for policymakers to figure out what’s working and what needs to be fixed. During a panel session hosted by the Bipartisan Policy Center, Richard Berner, director of the Office of Financial Research, said that more information is needed about liquidity because a lack of it is often cited as one of the unintended consequences of regulation. “Market liquidity is...


December 9, 2016 - IMFnews

Cato Institute’s Mark Calabria Up for the FHA Job?

If Cato's Mark Calabria becomes FHA chief, private MI firms could benefit…


December 8, 2016 - Inside Mortgage Finance

Detractors Question Carson’s Qualification as HUD Secretary, But Industry Thinks Effectiveness Depends on Key Appointees

President-elect Donald Trump this week officially nominated former Republican primary rival Dr. Ben Carson to head the Department of Housing and Urban Development – a move that elicited mixed responses from industry and government quarters. Carson, a pediatric neurosurgeon, eclipsed possible contenders for the HUD job, including Scott Brown, former U.S. senator from Massachusetts; Ed DeMarco, former acting director of the Federal Housing Finance Agency; Rick Lazio, former Republican congressman from New York; Blaine Leutkemeyer, another Republican lawmaker from Missouri; Brian Montgomery, former FHA commissioner and HUD assistant secretary; and Pamela Patenaude, president of the Terwilliger Foundation for Housing America’s Families. Carson’s nomination is...


December 8, 2016 - Inside Mortgage Finance

Jury Finds Allied Home Mortgage and CEO Liable for FCA, FIRREA Violations, Awards $93 Million in Damages

A Texas jury awarded the federal government $93 million in damages after finding entities under the Allied Home Mortgage brand liable for running an illegal net branching scheme and falsely certifying thousands of FHA loans, eventually causing huge losses for the FHA. The case was the first False Claims Act award related to FHA activity made by a jury. Although nearly all lenders have ended up settling FCA cases, Quicken Loans is still actively fighting FCA charges in a jury proceeding. The Department of Housing and Urban Development claims...


December 8, 2016 - Inside Mortgage Finance

Washington State Close to Setting the First State- Specific Capital Standard for Nonbank Servicers

Washington state is on track to become the first state to set capital requirements for nonbank mortgage servicers. A proposed rule has been met with resistance from the Mortgage Bankers Association, with the trade group calling on the state to halt the process and wait for pending national standards from the Conference of State Bank Supervisors. In September, Washington’s Department of Financial Institutions proposed capital requirements for nonbank servicers licensed in the state. Under the proposal, servicers would have to meet capital requirements set by the government-sponsored enterprises or a government entity. For servicers that solely handle non-agency mortgages, the Washington DFI proposed...


December 8, 2016 - Inside Mortgage Finance

Fair Housing Advocates Sue Fannie Mae for Alleged Discrimination in Foreclosure Maintenance Practices

Fannie Mae has not treated its foreclosed properties in African-American and Latino communities the same as those in predominately white neighborhoods, according to a federal lawsuit filed this week by the National Fair Housing Alliance. The NFHA, along with 20 fair housing and civil rights groups, said its investigation found signs of racial discrimination when it comes to the upkeep and marketing of Fannie’s real estate-owned properties in 38 metropolitan areas across the country. These properties in minority neighborhoods were blighted...


December 8, 2016 - Inside Mortgage Finance

Trump Has Vowed to Clamp Down on Regulations, But He Faces Limited Unilateral Powers, Long Odds

During his successful campaign for the White House, then-candidate Donald Trump won applause and support from the business community for his promise to substantially cut back on federal regulations. Many in the mortgage lending community had hopes the plan would include some relief from the mortgage regulations issued by the Consumer Financial Protection Bureau. Among other things, Trump said he would issue a temporary moratorium on “new agency regulations that are not compelled by Congress or public safety [and] cancel immediately all illegal and overreaching executive orders.” Richard Horn, who worked on the CFPB’s integrated-disclosure rulemaking known as TRID, said...


December 8, 2016 - Inside Mortgage Finance

Mortgage Stocks Show Signs of a Recovery as the ‘Trump Rally’ Continues. But Some of These Names May Disappear

Despite higher interest rates, publicly traded mortgage stocks have been rising since the election, but market watchers are cautious that recent gains could evaporate quickly. “Two things are going on here,” said Henry Coffey, an equities analyst at Wedbush Securities. “We’ve had a massive market rally, especially in financial stocks. But the general consensus is that the new administration is going to be less punitive than the current one.” Coffey added...[Includes one data table]


December 8, 2016 - IMFnews

Short Takes: Putting Fannie and Freddie in Receivership? / Cashing Out of Gains on GSE Common. Anyone? / No Chatter at Lunch / Freddie’s CSP Milestone / Stonegate Hires Renovation Leader

Have any of the GSE stock speculators that bought on the cheap cashed out of their gains?


December 8, 2016 - IMFnews

CFPB Slams Reverse Mortgage Companies for Deceptive Advertising

Of the three reverse mortgage firms, American Advisors Group was fined the most: $400,000...


December 7, 2016 - IMFnews

Short Takes: Post-Crisis Non-Agency MBS Gets AAA Rating / Refi Specialists Might as Well Call it a Day? / An IPO for Invitation Homes / Ben Carson in a Museum / FICO Readings on FHA and VA

Refi specialists could be in for a word of hurt...


December 7, 2016 - IMFnews

CFPB Issues New Exam Procedures for Reverse Mortgage Servicing

CFPB examiners will review a sample of servicing records for loans transferred within the previous year…


December 6, 2016 - IMFnews

Fair Housing Group Alleges Racial Bias in Fannie Foreclosure Upkeep

Fannie Mae added: “Through these actions we have demonstrated our continued dedication to providing quality care to all communities. And we remain firmly committed to continuing to provide such attention to our REO properties moving forward.”


December 6, 2016 - IMFnews

Short Takes: Bulk Servicing Auctions? / Rates May Fall / Congrats to Dr. Carson on Landing the HUD Job, Though Not From All / The Listener? / Ocwen Debt Exchange

The bulk servicing market has been quiet lately. But all that could change soon...


December 5, 2016 - IMFnews

Short Takes: What Goes Up, Must Come Down (GSE Share Prices) / An ‘Underperform’ Rating / Buy Low, Sell High Accomplished / Urban Revitalization, a HUD Goal for Ben Carson? / New Hires for Alterra Home Loans

We know one mortgage official who bought “a bunch” of Fannie Mae shares at $1.38...


December 5, 2016 - IMFnews

HUD Eases FHA Outsourcing Rules. HR Departments in Play?

HUD decided to ease the HR rules in new guidance issued at the end of November...


December 5, 2016 - IMFnews

SFIG Proposes Standards for ABS from Marketplace Lenders

SFIG’s Marketplace Lending Committee includes 250 individuals representing more than 70 companies.


December 5, 2016 - IMFnews

Now that the HUD Job is Settled, Speculation Begins on Trump’s Pick for FHA Commissioner

Cowen adds the nomination “also leaves the door open to FHA premium cuts, though the real driver of that will be the pick of an FHA commissioner.”


December 2, 2016 - IMFnews

Trump Nominates Dr. Carson for HUD Secretary; Speculation Begins on FHA Premium Cuts

Cowen adds the nomination “also leaves the door open to FHA premium cuts, though the real driver of that will be the pick of an FHA commissioner.”


December 2, 2016 - Inside FHA/VA Lending

Around the Industry

US Court Issues Injunction on DOL’s Overtime Pay Rule. A federal judge in Texas granted states’ motion to block the Department of Labor’s controversial overtime pay rule set to take effect on Dec. 1, 2016. In late breaking news, the Department of Justice said it will appeal the injunction. The decision handed down by Judge Amos Mazzant of the US District Court for the Eastern District of Texas would deprive approximately 4.2 million workers who stand to benefit from the rule. Twenty-one states, a coalition of business organizations and the Plano Chamber of Commerce challenged the rule in separate amici briefs, arguing they stand to lose money if the final rule takes effect. The final rule would require employers to pay a higher salary level for certain employees to be exempt from overtime. In addition, it would automatically update the minimum salary level every three years. In his decision, Mazzant determined that ...


December 2, 2016 - Inside FHA/VA Lending

HUD Fears Cycle of Restatements As IG Withholds Opinion Again

The Department of Housing and Urban Development has expressed concern about the inspector general’s decision to withhold its opinion on the results of FY 2016 audits of HUD and Ginnie Mae. In its audit report, the HUD inspector general said it has issued a disclaimer of opinion on HUD’s fiscal years 2016 and 2015 (restated) consolidated financial statements because of the agency’s failure to deliver both statements and their accompanying notes in a timely manner. In addition, there were several unresolved audit matters from past audits that prevented the IG from completing an examination of HUD’s and Ginnie Mae’s accounts and rendering an opinion. These unresolved matters related to a number of things, including the Office of General Counsel’s refusal to sign a management representation letter, HUD’s improper use of budgetary accounting methods, and the $4.2 billion in ...


December 2, 2016 - Inside FHA/VA Lending

HUD Eases FHA Outsourcing Rules, Clarifies Lenders’ Responsibilities

The Department of Housing and Urban Development has clarified requirements for FHA lenders before they can hire professional employer organizations to handle their human-resource (HR) functions. Generally, the HUD Single-Family Policy Handbook bars FHA lenders from outsourcing HR services such as payroll processing, payment of employment taxes, and/or the provision of employee benefits. However, HUD has decided to ease the rules in new guidance issued on Nov. 28. Based on an analysis of certain policies and potential risks, HUD now allows lenders to outsource their HR services if they retain full responsibility and legal liability for the actions of covered employees with respect to HUD regulations and requirements, particularly in the areas of compensation and use of contractors. Specifically, the lender must not compensate employees who perform underwriting, quality control, or ...


December 2, 2016 - Inside FHA/VA Lending

Jury Finds Allied Home Mortgage Entities Guilty, Awards $93M to US

A federal jury awarded more than $93 million in damages to the federal government after finding Allied Home Mortgage entities liable for civil mortgage fraud against the FHA. A unanimous jury found Allied Home Mortgage Capital and Allied Home Mortgage Corp., as well as the company’s president and chief executive, Jim C. Hodge. guilty of mortgage fraud. The jury awarded the Department of Housing and Urban Development and the Department of Justice a total of $93 million in damages, including $7.4 million against Hodge. The Allied entities allegedly violated the federal False Claims Act (FCA) and the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) in connection with “a decade of fraudulent misconduct” related to FHA lending. The FCA provides for treble damages and imposes a penalty of $5,500 to $11,000 for each violation. Separately, FIRREA imposes a ...


December 2, 2016 - Inside FHA/VA Lending

Groups Favoring One-Unit Approval, Differ on Owner-Occupancy Rate

Stakeholders voiced support for an FHA proposal to revive the agency’s single-unit approval policy for condominium financing but differed on owner-occupancy requirements. Both items are part of a proposed rule which would give the FHA more wiggle room in formulating its condo rules. The proposed rule’s 60-day comment period ended on Nov. 28. Among other things, the FHA is proposing to reinstate “spot approval” financing on individual units in condo projects that are not currently approved for FHA insurance. The Department of Housing and Urban Development terminated single-unit approvals a few years ago in favor of mandatory condo-project approval. Ultimately, the current approval process proved to be more cumbersome, resulting in many condo projects opting out of FHA. Under the proposed rule, single-unit approvals are limited to a maximum of 20 percent of the units in the ...


December 2, 2016 - Inside FHA/VA Lending

CFPB Issues New Exam Procedures For Reverse Mortgage Servicing

The Consumer Financial Protection Bureau has ditched the antiquated method for assessing servicer compliance with reverse mortgage-servicing rules in favor of new examination procedures. Depending on the scope, each reverse mortgage-servicing exam will include one or more of eight modules covering various facets of reverse mortgage servicing. There are two kinds of reverse mortgages. The FHA, under the Home Equity Conversion Mortgage program, insures most reverse mortgages. As with other FHA mortgage products, it has a maximum loan amount. Some lenders also offer proprietary (non-HECM) reverse mortgages, which are designed generally for borrowers with higher home values and more equity, the CFPB noted. Proprietary reverse mortgages are not federally insured. However, companies that offer them copy the consumer protections found in the HECM program, including ...


December 2, 2016 - Inside FHA/VA Lending

FHA Raises Loan Limits for HECMs, Forwards; VA Follows Freddie Mac

The FHA this week announced higher “floor” and “ceiling” loan limits for forward and reverse mortgages for 2017, pushing loan limits upward in certain metropolitan statistical areas by as much as $162,500. The loan-limit changes will take effect on Jan. 1, spurred by rising median home prices. The Case-Shiller Home Price Index for September reported that home prices increased 5.5 percent year-over-year, driven by a tight supply of homes for sale, especially in the West. Each year, FHA recalculates its loan limits based on 115 percent of the median house price in the area. For counties located in MSAs, the loan limit is calculated based on the highest-cost county within the MSA. Under the 2017 changes, FHA will raise its nationwide “floor,” or low-cost area mortgage limits, for one-unit properties to $275,665 from $271,050, a difference of $4,615. In high-cost areas, the loan-limit ceiling for a ... [ 2 charts ]


December 2, 2016 - Inside FHA/VA Lending

FHA, VA Deliveries to Ginnie Mae Increase During First Nine Months

Total FHA and VA originations increased during the first nine months of 2016 compared to the same period last year, although VA was more active, posting a double-digit production increase, according to an analysis of Ginnie Mae data. Lenders delivered $201.0 billion of FHA loans to Ginnie single-family mortgage pools over the last three quarters, up 4.8 percent from the previous year. Approximately 65.4 percent and 29.3 percent of FHA loans securitized were purchase loans and refinances, respectively. The remainder was loan modifications. VA originations totaled $143.2 billion over the same period, up 22.3 percent from last year. Refinances accounted for 51.9 percent of volume and purchase loans comprised 47.0 percent. The share of FHA loans in agency mortgage-backed securities for the nine-month period was 19.5 percent and 13.9 percent for VA. FHA loans accounted for ...


December 2, 2016 - IMFnews

What We’re Hearing: Will the GSE-Investing PE Firms Get Greedy? / Buy Low, Sell High? / How Plugged In is Mnuchin? / Will Trump Try to Bring White Collar Jobs Back Home Too? / The Strange Case of Nebraska and FHA Loan Limits / Meg Burns Gets Promoted

Will the GSE-investing PE firms blow it?


December 2, 2016 - Inside MBS & ABS

DOJ’s MBS Case Against Deutsche Bank Could Be A Conflict of Interest for the Trump Administration

Democrats in the House Financial Services Committee raised concerns last week about how the Department of Justice will handle MBS-related charges against Deutsche Bank with President-elect Donald Trump set to take office. The Democrats called for strong oversight by eight inspectors general involved with regulators of the financial services industry, noting potential conflicts due to Trump’s business interests. “While federal ethics rules require nearly all government employees to recuse themselves from matters that affect their outside financial interests, these rules do not apply...


December 2, 2016 - Inside MBS & ABS

SFIG Proposes Standards for ABS from Marketplace Lenders, Aiming to Support Growth Without Regulation

The Structured Finance Industry Group published recommendations this week for loan-level data disclosure for ABS backed by unsecured consumer loans originated by marketplace lenders. The proposal was the first in a planned series of “Green Papers” from the trade group that will seek to support “responsible growth” in the issuance of ABS from marketplace lenders. “The best practices initiative, rooted in supporting the responsible growth of securitization in the marketplace sector, will seek to identify a framework of standards and work to identify gaps in application or understanding,” SFIG said. The trade group said...


December 2, 2016 - IMFnews

FHA Follows FHFA’s Lead and Increases Loan Limits. The Reason: Rising Home Prices

Just over a week ago, the Federal Housing Finance Agency raised the maximum conforming loan limit for GSE mortgages by $7,100 for 2017, citing an increase in home prices.


December 2, 2016 - IMFnews

Allied Home Mortgage on the Hook for $93 Million of Damages in FHA Case

The case against Allied Home Mortgage stemmed from a “whistleblower” action filed in Boston back in 2011.


December 2, 2016 - IMFnews

Can a Former MBS Trader Successfully Privatize the GSEs? And What About the Government Guaranty?

Cowen & Co. believes there’s now a 65 percent chance that GSE reform will happen over the next two years.


December 1, 2016 - Inside Mortgage Finance

Overtime Pay Injunction Leaves Lenders, Other Employers In Limbo as DOL Ponders Its Response to the Court Order

Mortgage lenders and other employers that have made or are preparing to implement changes to comply with the Department of Labor’s revised overtime pay regulations may have to reevaluate whether to hold off or go forward with those plans, according to wage and overtime experts. On Nov. 22, Judge Amos Mazzant of the Eastern District of Texas granted a request by several states to block the new overtime pay rules that would have gone into effect on Dec. 1. The judge issued a preliminary injunction after determining that the DOL did not have the authority to decide whether workers should be paid overtime based on their salary level alone. Mazzant agreed...


December 1, 2016 - Inside Mortgage Finance

Mortgage Industry Parses Tea Leaves As Trump Begins Assembling Cabinet

The incoming administration of President-elect Donald Trump is likely a couple of months away from formal confirmation by the U.S. Senate of new cabinet officials. But at least one position has apparently been settled – that of Treasury secretary – and other names have been circulated, including that of a possible head of the Department of Housing and Urban Development. At the same time, Trump has begun fleshing out the personnel that will serve on various “landing teams,” which help ease the transitions at various federal agencies. On the cabinet level, the new president has decided...


December 1, 2016 - Inside Mortgage Finance

Trump Administration, Republican Control of Congress Present Mixed Bag for Mortgage Industry Participants

Lenders and servicers are likely to see some regulatory relief in the coming years though federal support for the housing market could also be reduced, according to officials at the Mortgage Bankers Association. The MBA’s Mortgage Action Alliance recently hosted a call with MBA officials providing projections for how the Trump administration and Republican control of Congress will impact the mortgage industry. “Things that were deemed impossible before the election are now in play,” said Meghan Sullivan, the MBA’s Senate Republican lobbyist. She said...


December 1, 2016 - IMFnews

Overtime Pay Regs in Doubt Again. Mortgage Firms Ponder Their Options

Some banks have reclassified mortgage loan officer duties as a way to avoid paying overtime, IMFnews was told.


December 1, 2016 - IMFnews

GSE Common Once Deemed Worthless, Now Has a ‘Market Cap’ of $43.15 Billion

Based on current trading values, Fannie common now has a market capitalization rate (share price multiplied by number of shares) of $28.01 billion. Freddie common is valued at $15.14 billion.


November 30, 2016 - IMFnews

Short Takes: High Hopes for GSE ‘Recap and Release’ / Mnuchin Will be Confirmed / Another Mortgage Deal for Incenter LLC / Arch in Huge Debt Offering / What’s $20 Trillion Among Friends?

In case you haven’t noticed: the national debt is ready to crack the $20 trillion mark – almost twice the dollar volume of outstanding residential debt in the United States.


November 30, 2016 - IMFnews

Incoming Treasury Chief Mnuchin: Resolving Fannie and Freddie a Top Priority. Share Prices Soar!

As IMFnews went to press Wednesday, Mnuchin said in a Fox TV interview that resolving Fannie and Freddie will be a top priority.


November 30, 2016 - IMFnews

Lone Star Readies Another MBS Backed by New Nonprime Mortgages

The mortgages were originated by Lone Star affiliate Caliber Home Loans, but also LendSure Mortgage and Sterling Bank & Trust.


November 30, 2016 - IMFnews

Mortgage Complaints Down 6 Percent from Last Year

Despite the improvement in gripes filed, mortgage complaints are among the top three areas where consumers feel they are being taken advantage of…


November 29, 2016 - IMFnews

Short Takes: Trump Names HUD 'Landing Team' / Another Day and No Word from Doc Carson on the HUD Job / Trump ‘Landing Team’ Hits the Beach at the CFPB / Gather Intel and Advise / Resume Polishing Since Election Night? / Freddie Publishes eMortgage Vendor List

Moreover, anyone close to Richard Cordray has likely been working on their resume since Tuesday night, Nov. 8…


November 29, 2016 - IMFnews

FCC Hangs Up on MBA’s Telephone Exemption Request

The MBA said the calls would generally be from servicers to borrowers, seeking to determine the reasons and nature of a delinquency…


November 29, 2016 - IMFnews

Trump May Mean Less Federal Enforcement, but the States Will Remain Aggressive

A reason to worry: several federal consumer financial protection laws give direct enforcement authority to the states…


November 28, 2016 - Inside the CFPB

Other News in Brief

Securitization Group Meets with CFPB Officials. Earlier this month, staff and members of the Structured Finance Industry Group met with CFPB Director Richard Cordray and other senior officials to talk about the state of the non-agency mortgage securities market and some of the factors hampering its return.... Mortgage Lenders Meet With Bureau, Other Regulators, to Discuss Diversity, Inclusion. A small group of mortgage lenders recently met with staff of the CFPB, the Federal Reserve, the Federal Deposit Insurance Corp., the Federal Housing Finance Agency and the Office of the Comptroller of the Currency to discuss best practices on how to develop and maintain diversity and inclusion programs within the mortgage industry, according to an account by the Mortgage Bankers Association....


November 28, 2016 - Inside the CFPB

Dems Worried GOP Will Gut Dodd-Frank Via Funding Bill

The leading Democrats on the Senate Banking, Housing and Urban Affairs Committee and the House Financial Services Committee urged Congressional leaders earlier this month to reject any Republican attempts to use so-called must-pass government appropriations legislation to scale back the Dodd-Frank Act and the CFPB. In a letter sent to Senate and House leaders of both parties earlier this month, Sen. Sherrod Brown, D-OH, and Rep. Maxine Waters, D-CA, said they will oppose ideological policy riders to year-end funding legislation aimed at rolling back the consumer protections of Dodd-Frank. “Specially, Congress must not include in end-of-year funding legislation any riders designed to repeal, undermine or delay any provisions of Wall Street reform, including those targeted at the CFPB and the ...


November 28, 2016 - Inside the CFPB

New Bureau Report Details Problems With VA Refi Lending

Roughly 14 percent of the 12,500 mortgage complaints the CFPB has received to date from U.S. military personnel, veterans and their dependents involve problems with refinancing, and the issues they face have been changing over time, according to a new report from the bureau. “As the housing market has rebounded, we hear less about veterans struggling to refinance their loans when facing a financial hardship or imminent default and more about the problems associated with refinancing when they are using it as a tool to get potentially more favorable loan terms,” the CFPB document stated. The agency then delved into some of the specific gripes being lodged against mortgage companies. “We receive many complaints from veterans who believe they are ...


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In 2016, what have you been paying your retail residential loan officers, on average, as a commission?

25 to 50 basis points per loan
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76 to 100 bps
101 to 150 bps
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