Contrary to other segments of the mortgage industry, a huge majority of title professionals will be ready to play ball when the CFPB’s TILA/RESPA integrated disclosure rule goes live Aug. 1, 2015, according to a survey conducted by the American Land Title Association. “Ninety-two percent of our survey respondents indicated their company will be prepared to implement the new forms and comply with the CFPB’s regulation,” said Michelle Korsmo, ALTA’s chief executive officer. “The land title insurance industry has been a leader in preparing the real estate industry for the new disclosures and that is reflected in the preparedness of our members.” However, perhaps not so surprisingly, collaboration with lenders and real estate agents, and potential closing delays top the ...

Sen. Richard Shelby, R-AL, chairman of the Senate Banking, Housing and Urban Affairs Committee, released the text of his pending regulatory relief bill last week. Among a handful of CFPB-related provisions is one that would grant qualified mortgage status under the bureau’s ability-to-repay rule for residential loans held in portfolio. However, as per the draft Financial Regulatory Improvement Act of 2015, certain conditions would have to apply. To begin with, the lender/creditor would have to hold the loan in portfolio from its inception, or any acquirer of the loan must continue to hold it in portfolio. Additionally, the mortgage cannot have been acquired through securitization, nor can it have certain forbidden features, like negative amortization, interest-only provisions, or a loan ...

The CFPB sued Ohio-based Nationwide Biweekly Administration, Loan Payment Administration, and their owner, Daniel Lipsky, in federal district court last week, accusing them of misrepresenting the interest savings consumers will achieve through a biweekly mortgage payment program called the “Interest Minimizer” and misleading consumers about the cost of the program. Under the program, consumers who enroll send Nationwide half their monthly mortgage payment every two weeks, effectively making one additional monthly payment per year. According to the bureau, Nationwide charges consumers a setup fee of up to $995 to enroll in the program and charges consumers between $84 and $101 in payment processing fees each year they remain enrolled. According to the bureau’s complaint, the defendants made misrepresentations about the ...

The CFPB has launched a public inquiry into student loan servicing practices that create repayment challenges, hurdles for distressed borrowers, and economic incentives that may affect the quality of service. The bureau said it has observed that many borrowers are experiencing significant student debt stress. “Consumers have complained about billing problems associated with payment posting, prepayments and partial payments,” it said. The CFPB has also heard from distressed borrowers that student loan servicers aren’t being very useful in helping them avoid defaults and delinquencies. “Distressed borrowers complain that they are given the runaround when they ask for help, they have a hard time getting straight answers from servicing staff, and that the staff is untrained or unequipped to deal with ...

The CFPB recently announced it brought an enforcement action against Sprint and Verizon, alleging illegal “cramming” of hundreds of millions of dollars in unauthorized third party charges on customers’ mobile phone accounts. Under the terms of proposed consent orders, which are pending court approval, the pair will provide $120 million in consumer refunds, as well as pay $38 million in federal and state fines. The problem stemmed from the alleged failure on the part of Sprint and Verizon to properly monitor their outsourced processing of payments to third party vendors for digital purchases. “The lack of oversight by Sprint and Verizon allowed the vendors to have nearly unfettered access to consumers’ wireless accounts,” said the CFPB. “The billing systems for ...

The top three operations in the debt collection business all saw their consumer complaint numbers fall both quarter over quarter and year over year, according to a new analysis by Inside the CFPB. Fourth-ranked Enhanced Recovery Co. was the only one of the top five to see increases in both timeframes, and they were doozies: a 96.5 percent jump QoQ and a huge spike of 184.1 percent YoY. Citibank, the only financial institution in the top tier, was uneven, with complaints up a small 6.3 percent QoQ, but down a substantial 28.5 percent YoY. This dynamic seemed in full play for the entire industry, with many firms doing well, some doing poorly [with an exclusive chart] ...

CFPB Updates Mortgage Origination Examination Procedures to Reflect TRID. The CFPB has put out an updated version of its Supervision and Examination Manual’s Mortgage Origination examination procedures. The latest iteration features guidance on how its compliance examiners will examine loan disclosures and the terms of closed-end residential mortgages that are subject to the pending integrated disclosure rule under the Truth in Lending Act and the Real Estate Settlement Procedures Act. Of the manual’s eight modules, the updated TRID examination procedures are reflected in module #4. “Examiners should obtain and review a sample of complete loan files to assess the entity’s compliance,” states the new section of the manual. “If consumer complaints regarding mortgage origination and closing indicate potential violations of ...

CFPB May Review Lender-Paid MI. Pricing on lender-paid mortgage insurance policies has come down over the past several months, apparently spurring the CFPB to take a look at what’s going on behind the curtain. Citing industry officials who claim to have knowledge of the situation, Inside Mortgage Finance, an affiliated publication, reported late last week that the powerful consumer regulator may focus on whether there is some kind of quid pro quo going on between lenders and mortgage insurers. In particular, the CFPB is interested in the discounting of LPMI in exchange for a lender sending more of its MI business to an insurer and whether such a practice violates the Real Estate Settlement Procedures Act, the newsletter reported. In ...

House GOP’s Proposed Budget Rejects IT Administrative Fee, HTF. House Republicans withheld funding for a proposed administrative fee, which the FHA planned to invest in technology to improve quality assurance and reduce paid-claims losses. The Department of Housing and Urban Development first requested authority to collect the fee in the President’s FY 2015 budget request but was turned down. It appears House Republicans are on track again to reject the proposed fee in the FY 2016 appropriations bill, said HUD Secretary Juan Castro. Castro lambasted the House Republicans’ proposed budget cuts, saying they would hinder HUD from carrying out its mission and from investing in communities that most need help. The GOP bill also rescinds funding to the proposed Housing Trust Fund, which allocates a small percentage of Fannie Mae and Freddie Mac profits to ...

With the April acquisition of Home Loan Servicing Solutions’ assets and liabilities, New Residential gained a significant portion of the clean-up call rights for outstanding non-agency MBS. Officials at the real estate investment trust said New Residential plans to execute the call rights and acquire more rights as the MBS feature presents strong profit potential. New Residential owns the clean-up call rights on more than 2,100 non-agency MBS with an outstanding balance of about $235 billion. That’s about 34 percent of the non-agency MBS market. “This should be...