Last week, the Office of the Comptroller of the Currency and the Department of Justice announced a $12 million settlement that resolves legal and regulatory actions brought against Capital One for alleged violations of the Servicemembers Civil Relief Act, including foreclosing without a court order. The agreement requires Capital One to pay approximately $7 million in damages to service members for SCRA violations, including at least $125,000 in compensation plus compensation for any lost equity (with interest) to each service...

Hawaii. Last month, the state Department of Commerce and Consumer Affairs announced a transition period for certain mortgage loan originator companies (MLOCs) to comply with recently enacted mortgage loan originator (MLO) licensing requirements. Retroactively effective as of July 1, 2012, all exempt registered MLOs and MLOCs of a subsidiary of an insured depository institution regulated by a federal banking agency must be licensed under the state’s SAFE Act. Affected MLOs may continue to originate mortgage loans…

Consumer Financial Protection Bureau. Privileged Information Rule Now Effective. The Consumer Financial Protection Bureau’s final rule on the confidential treatment of privileged information becomes effective Monday, Aug. 6, 2012. The rule makes clear that an institution that provides privileged information to the CFPB does not waive any privilege it may have related to third parties, and that bureau sharing of privileged information to another federal or state government agency does not waive any privilege that might apply...

Inside Mortgage Finance Publications’ latest website poll doesn’t show a lot of optimism about the Consumer Financial Protection Bureau and its potential effectiveness. The poll began by noting that the CFPB recently passed its one-year anniversary as an up-and-running federal regulator. Respondents then were asked: Do you think the CFPB has done a good job so far? A whopping 52 percent choose the option that read: “I don’t think the CFPB will ever do a good job given its mandate to protect consumers even if it means crippling the...

Officials at Ocwen Financial revealed this week that the servicer hired more employees than operationally necessary in an effort to win bids for servicing and subservicing. They said they are now in the process of right-sizing staffing levels through a number of different techniques. “We over-hired to make sure we could hit the cover off the ball on the deals that we knew we had in-hand,” Ron Faris, president and CEO of Ocwen, said during the servicer’s earnings presentation for the second quarter of 2012. Ocwen completed ...

Encouraged by the performance so far of the recently revised Home Affordable Refinance Program, the Federal Housing Finance Authority announced this week it is working to expand the pool of borrowers eligible to refinance through HARP by aligning Freddie Mac policies with Fannie Mae’s. The agency announced the additional tweaks to HARP at the same time it said it would not sanction a Treasury Department-endorsed effort to allow the two government-sponsored enterprises to write down mortgage principal as part of loan modifications. The FHFA said that Freddie will soon issue...

The Federal Housing Finance Agency this week said that it will announce new “gradual” adjustments in MBS guarantee fees charged by Fannie Mae and Freddie Mac. The adjustments will take effect late in the year, said the FHFA, which plans to reveal the changes by the end of this month. MBS guarantee fees rose...

Sales and purchases of vintage non-agency MBS have been well above average levels in recent weeks as investors see value in the sector with the housing market recovering. The purchases are being made by traditional buyers such as money managers and insurance companies as well as by banks, according to industry analysts. Daily trading volume of non-agency MBS has averaged about $3.0 billion in recent weeks, based on an analysis of TRACE data by Barclays Capital. During the past six to 12 months, daily non-agency MBS trading averaged $1.7 billion to $2.0 billion. Some $1.09 trillion in non-agency MBS was...

Springleaf Financial Services is gearing up to issue its second non-agency MBS of the year, a $970.0 million deal backed by seasoned subprime mortgages. The company, formerly known as American General Finance, stopped new residential mortgage originations in January of this year. Now owned by Fortress Investment, Springleaf issued a $473.1 million MBS backed by seasoned subprime loans in early April. At the end of the first quarter, the company said it had $9.7 billion of real-estate finance receivables on its books, most of which were classified as nonprime or subprime. Springleaf Mortgage Loan Trust 2012-2 features...

Chicago, Suffolk County, NY, and Berkley, CA, have joined the ranks of local governments considering the controversial notion of using eminent domain to seize performing underwater mortgages, restructure their terms and repackage them for sale to other private investors. “Given the size of the foreclosure epidemic in Chicago, the city should explore every possible avenue to keep families in their homes and reduce the number of vacant properties that breed crime and erode the stability of our neighborhoods,” Alderman Edward Burke, chairman of the city’s finance committee, said last week. In March 2012, nearly 667,000 Chicago-area homeowners were...