The CFPB provided Congress with the agency’s first fair lending report, highlighting its first-year accomplishments, and affirming a commitment to the lending industry to be clear about its expectations going forward. “We are still in the process of building our fair lending program and expect the CFPB’s contribution to the work of ensuring compliance with fair lending laws and promoting access to credit will grow as our program progresses,” the report stated. “We are also developing risk-based approaches to...

Exceptions are part of any business, and when it comes to fair lending risk exceptions, "certainly the CFPB acknowledges that," said compliance expert Tammy Butler with Optimal Blue. However, officials at the bureau are concerned with when lenders give exceptions, for what reasons and whether or not they are given fairly. "To do that, you have to have policy and monitoring," she said. Butler then provided the following checklist to help lenders build their exception policy and procedures...

Chicago will be the first city to directly report financial activity and fraud to the CFPB, under an information-sharing agreement announced last week by CFPB Director Richard Cordray and Chicago Mayor Rahm Emanuel to help protect the city's consumers from scams related to payday lending, small-dollar loans, student loans, reverse mortgages and home repairs. "We want to learn from and expand on the ways you protect consumers, and to share these approaches nationwide," Cordray said in a press conference...

As anxious as mortgage lenders are about the apparent delay in the CFPB’s issuance of an ability-to-repay/qualified-mortgage final rule, industry attorneys, trade group experts and consumer advocates unanimously believe that bureau is taking so much time so it can put out the best, most balanced rule as possible. Carrie Hunt, general counsel and vice president of regulatory affairs for the National Association of Federal Credit Unions, said she isn’t as concerned about when the rule comes as she is about the quality of it...

The CFPB recently joined in the filing of a motion to dismiss a case that includes a legal challenge to President Barack Obama’s controversial recess appointment of Richard Cordray as the bureau’s director.The eventual outcome of State National Bank of Big Spring, Texas, et al. v. Geithner, et al., could be significant in that it might affect not only Cordray’s appointment but an entire new level of regulatory oversight at the bureau that was inaugurated by, and in fact dependent upon, the appointment of a director at the bureau. Most notable among them would be nonbank mortgage lending...

Fair lending enforcement moved to a new level last week when the CFPB and the Department of Justice signed an agreement to strengthen the coordination of their efforts in this regard as well as to avoid duplication. The good news for the industry is any effort to reduce government duplication could similarly reduce lenders’ compliance burden. Under the memorandum of understanding the agencies signed, the CFPB and Justice will meet regularly on investigations and establish strict confidentiality for shared information...

Last week, the U.S. Court of Appeals for the D.C. Circuit cast some doubt on the validity of President Barack Obama’s controversial recess appointments to the National Labor Relations Board – and by extension, that of Richard Cordray as director of the CFPB. Noel Canning v. National Labor Relations Board involves a challenge to the president’s recess appointments to the NLRB in early January – during a period when the Senate was holding pro forma sessions every three days specifically to deny him the opportunity to make...

FHA endorsements jumped 18.8 percent in October from the previous month and by more than half from a year ago, with mortgagees accounting for 80 percent of production, according to Inside FHA Lending’s analysis of FHA data. FHA originations, excluding Home Equity Conversion Mortgage loans, totaled $22.8 billion in October, up from $19.2 billion in September and 56.4 percent more than a year ago. Fixed-rate forward mortgages accounted for nearly all FHA loans produced during the month, with purchase mortgages having a slight edge in the mix over refinances. Top-ranked Wells Fargo outdid other lenders in October with ...

The FHA has extended a temporary waiver of its regulation that prohibits property flipping in the single-family mortgage insurance program to encourage more investors to participate in agency efforts to ease its burgeoning inventory of real estate-owned properties. First issued in January 2010, the regulatory waiver is now effective through Dec. 31, 2014, after two previous adjustments since issuance. Prior to the waiver, a mortgage was not eligible for FHA insurance if the purchaser sold the property within 90 days of its acquisition and is ...

The Department of Housing and Urban Development this week clarified that mortgages using cash investment funds provided under a government housing assistance program to meet the FHA’s 3.5 percent downpayment requirement are eligible for FHA insurance. HUD issued the interpretive rule to clarify the confusion caused by a provision in the National Housing Act that prohibits certain sources of a homebuyer’s funds for the required minimum FHA downpayment on a home loan. Because of this provision, cash investment funds provided by federal, state and local homeownership assistance programs to first-time and lower-income homebuyers may be deemed ...