In a 10-K filing, PHH said its mortgage business relies on just two firms for 41 percent of its private-label retail business: Merrill Lynch Home Loans at 29 percent and Morgan Stanley at 12 percent.
Servicers would face annual government certifications and biennial examinations by the new regulator/insurance fund. Minimum operational and management standards would be created for internal controls, recordkeeping, audit systems, and reporting, to name just a few.
For lenders that contribute at least 15 percent of the loans included in an issuance, Fitch said it will conduct an enhanced operational review of the lender’s origination program and underwriting guidelines.
The Fed has promised to “taper” its MBS and Treasury investments in the months ahead, but with MBS issuance on the decline because of falling originations, the central bank likely will maintain or even increase its market share of purchases.
How does the Johnson-Crapo bill favor senior preferred shareholders? The language notes that when assets in Fannie and Freddie are eventually sold, the idea is to “maximize the return for the senior preferred share-holders of the enterprises”…
The House Financial Services Committee late last week passed bipartisan legislation that would provide an alternate way of defining “rural” for purposes of the CFPB’s qualified mortgage standard so a bank could make its case to the bureau as to why a jurisdiction should be fit into that category. H.R. 2672 would direct the CFPB to establish an application process under which a person who lives or does business in a state may apply to have an area designated as a rural area for the purpose of exempting certain loans from the CFPB’s ability-to-repay rule if that area has not already been designated as such by the bureau.
Rep. Jeb Hensarling, R-TX, chairman of the House Financial Services Committee, recently threatened to subpoena the CFPB to supply information on the bureau’s indirect auto lending guidance and the methodology it uses in determining whether fair lending violations exist in that space. “By refusing to disclose this information, the bureau has deliberately deprived indirect auto lenders of any meaningful way to tailor their company’s lending practices and compliance systems so as to mitigate or eliminate the fair lending risk the bureau asserts to be present,” Hensarling said in a recent letter to CFPB Director Richard Cordray.
Lender representatives privately enjoyed a bit of disparate impact schadenfreude last week when accounts surfaced in the news media that the CFPB’s own internal employee evaluations demonstrated sharp racial disparities. Citing confidential agency data it obtained, American Banker reported that the bureau’s own managers have shown distinctly different patterns in how they rate employees of different races, with white employees ranking distinctly better than minorities in performance reviews used to grant raises and bonuses. Overall, whites were twice as likely to receive the agency’s top grade last year than were African-American or Hispanic employees, the newspaper said.
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