The CFPB has granted a request from financial institutions for extra time to prepare for the agency’s pending international remittance transfer final rule, but it may not be enough to satisfy them. Earlier this month, the bureau temporarily postponed the Feb. 7, 2013, effective date of its remittance transfer rule pending finalization of its December 2012 proposal to make changes in three narrow areas. First, the proposal would provide more flexibility when it comes to the disclosure of foreign taxes, as well as fees imposed by a designated recipient’s institution for receiving a remittance transfer in an account. Second, the proposal would limit...

The CFPB has responded to a variety of mortgage appraisal issues on two different fronts, publishing a final rule all its own in conjunction with the Equal Credit Opportunity Act, and participating in an interagency rulemaking in the context of the Truth in Lending Act. On the ECOA front, the bureau issued a final rule that requires mortgage lenders to provide applicants with free copies of all appraisals and other home-value estimates, although a lender generally may still charge the consumer a reasonable fee for the cost of conducting the appraisal or other estimate. In essence, then, a lender can charge...

The CFPB decided to exempt small entities that service fewer than 5,000 loans and service only mortgages that they or an affiliate originated or own from a number of the requirements of its new mortgage servicing final rule. For instance, the bureau exempted small servicers from having to create and maintain new general servicing policies and procedures, and from having to issue monthly statements that would include more information than most community banks currently provide. The new rule also permits...

The CFPB has issued its voluminous new national mortgage servicing final rules, including a host of required loss mitigation rules and processes and bringing a substantial amount of uniformity to a sector much maligned because of its controversial “robo-signing” practices. Under the rule, servicers will have to follow specified loss mitigation procedures for a mortgage loan secured by a borrower’s principal residence. If a borrower applies for a loss mitigation option, the servicer is generally required to acknowledge, within five days and in writing, that it has received the application and inform the borrower whether the application is complete. If the application is...

A day before a federal appeals court declared his three recess appointments to the National Labor Relations Board to be unconstitutional, President Barack Obama again nominated Richard Cordray to be the director of the CFPB, setting the stage for another potentially bitter confrontation with Republican opponents in the Senate. Obama made a recess appointment of Cordray to his current position at the same time he made his NLRB moves, early last year, bypassing the traditional Senate confirmation process in an end-around to fierce opposition from GOP members in the chamber. The problem for the president is...

Although the CFPB is done – for now – with its regulations governing what servicers can do regarding their residential mortgage customers, there’s still one area they intend to explore: servicing transfers. At a regulatory field hearing in Baltimore earlier this month, agency officials said they will look into the issue. How far it will go is another matter. “They’re definitely working...

In a development that could inject turmoil and chaos into the CFPB’s regulatory sphere of influence, a three-judge panel of the U.S. Court of Appeals for the D.C. Circuit has declared the three recess appointments President Barack Obama made to the National Labor Relations Board early last year to be unconstitutional. The judges said the appointments were illegitimate because the Senate was not actually in recess when they were made. “Considering the text, history and structure of the Constitution, these appointments were invalid from their inception,” the ruling stated. Here’s why this is...

Some top legal minds expect to see more investigations, and perhaps settlements, brought by the Residential MBS Working Group in the months ahead, and they’ll likely be flavored by interagency turf wars and the political ambitions of the elected officials that are helping to steer the group’s actions. “Just on the basis of prosecutorial rivalry, you can expect there will be further activity in this area,” said Jeremiah Buckley, partner in the BuckleySandler law firm, during a webinar discussion this week on the working group’s activities. Andrew Schilling, former chief of the Civil Division of the U.S. Attorney’s Office for the Southern District of New York...

Rule for Selling Government Mortgages to Fannie Mae Updated. Eligibility for delivery of mortgage loans backed by FHA, VA and the Department of Agriculture is now available on a negotiated basis only, Fannie Mae announced in a recent update to its Selling Guide (Announcement SEL-2013-01). The change is effective for all government loans, including whole loans sold to Fannie on or after May 1, 2013, and government loans in mortgage-backed securities with issue dates on or after May 1. Genworth to Delink Struggling Mortgage Insurance Operations from Holding Company. Genworth Financial plans to ...

Some FHA lenders are seeing new opportunities in the distressed property market as they offer new or expand on existing 203(k) rehabilitation mortgage insurance products. Houston-based Envoy Mortgage, a full-service mortgage banker with retail branches across the country, has broadened its FHA 203(k) product line to include a full 203(k) option. The option allows borrowers to devote more funds for repair and renovation, which are rolled into the mortgage amount. The full 203(k) option is a step up from what Envoy is already offering – a “streamline” 203(k) program designed for borrowers that have ...