The National Association of Mortgage Brokers, the Mortgage Bankers Association and the National Association of Realtors are scheduled to meet with CFPB Director Richard Cordray and his staff this week to discuss various issues related to the bureau’s ability-to-repay rule and its qualified mortgage standard. More specifically, during their Tuesday, Nov. 5, 2013, meeting, the industry representatives plan to raise the impact of the points-and-fees cap, what they assert are the biases against mortgage brokers, and the ability for consumers to...

Mortgage lenders got a huge compliance and liability break, courtesy of the CFPB and the other federal financial regulators. A mortgage lender’s strategic decision to provide only qualified mortgages, in and of itself, will not raise its fair lending risk, the CFPB and four other regulators declared in new guidance issued last month. The agencies said they have received numerous inquiries from mortgage lenders about whether they would be liable under the disparate-impact doctrine of the Equal Credit Opportunity Act and its implementing...

Congress has no need to enact additional legislation to impose tough loss-mitigation standards on servicers and owners of securitized residential mortgage loans for the benefit of consumers. The CFPB’s mortgage servicing regulation thoroughly covers all related issues in this regard, according to a leading industry attorney. Larry Platt, a consumer finance lawyer at the global law firm K&L Gates, LLP, appeared late last month in a personal capacity before the Senate Banking, Housing and Urban Affairs Committee to discuss the Housing...

The CFPB privately acknowledged to members of Congress recently that the bureau has had at least three data breaches thus far involving personally identifiable information from individuals who submitted complaints through the CFPB’s consumer response system. The admission was included among pages and pages of answers the bureau sent in response to numerous questions officials had received from lawmakers on Capitol Hill. Rep. Keith Rothfus, R-PA, brought the breaches to the public’s attention last week during a hearing on CFPB reform...

A bipartisan group of 22 members of the U.S. Senate wrote CFPB Director Richard Cordray late last month to raise concerns about the bureau’s guidance affecting the indirect auto financing market and auto dealers’ ability to negotiate retail margins with consumers. Back in March, CFPB Bulletin 2013-02 instructed bank and nonbank indirect auto lenders about complying with federal fair-lending requirements when it comes to auto dealers “marking up” the lender’s risk-based buy rate and receiving compensation based on the...

The CFPB has filed a lawsuit in federal district court against a Kentucky law firm, Borders & Borders, PLC and its principals, for illegally paying kickbacks for real estate settlement referrals through a network of shell companies. The CFPB alleges that Borders & Borders and principals Harry Borders, John Borders, Jr., and J. David Borders violated the Real Estate Settlement Procedures Act by operating a network of affiliated companies to pay kickbacks for referrals of mortgage settlement business. RESPA prohibits giving...

The long arm of the law being enforced by the new consumer sheriff in town is extending to EBay Inc., which is facing an investigation by the CFPB over a loan program that resembles a structure used by high-interest lenders to bypass state regulations before the practice was eradicated by regulators. The program at issue, known as Bill Me Later, is a service provided by EBay’s PayPal unit that derives funding from Comenity Capital Bank, based in Salt Lake City, UT, to make loans that are subsequently purchased and managed by EBay...

The complaints that consumers filed with the CFPB about their mortgages fell for the second straight quarter during the third quarter of 2013, and with a bigger drop – 16.8 percent – than was seen in 2Q13, when the fall off was at 9.2 percent, according to a new analysis of consumer complaint data by Inside the CFPB. Leading the way again were gripes about loan modifications, which fell 25.5 percent in the third quarter, versus a drop of 10.3 percent in 2Q13. Complaints related to applications and other aspects of the...{includes 1 chart]

The parties in Township of Mount Holly v. Mt. Holly Gardens Citizens in Action, Inc., currently pending before the Supreme Court of the United States, have reached a tentative settlement, the Wall Street Journal reported late last week, citing people involved in the dispute. The prime question before the SCOTUS in Mount Holly is whether disparate-impact claims are cognizable under the Fair Housing Act. Mount Holly challenges the legal position of the Department of Housing and Urban Development that disparate impact can be used to...

CFPB Director Richard Cordray tried to reassure the mortgage lending community that the CFPB’s ability-to-repay rule with its qualified mortgage standard will provide all the legal protections they are expecting. One issue “that some consultants and lawyers have raised is whether the law and our rule will deliver the assured and predictable legal protections even for QM loans,” Cordray said in an address recently before the annual convention of the Mortgage Bankers Association in Washington, DC. “We believe strongly that they will...