Research by two economists in the CFPB’s Office of Research found that many homebuyers do not shop around for a mortgage, and that costs them a pretty penny. “Close to half of consumers did not shop before taking out a mortgage,” CFPB economists Alexei Alexandrov and Sergei Koulayev said in a new white paper. They cited the National Survey of Mortgage Originations, a representative survey conducted jointly by the bureau and the Federal Housing Finance Agency, which found that almost half of consumers “seriously considered” only one lender before making a choice. Also, “Barely any consumers considered more than three lenders,” the economists added. “Worse, many consumers do not seem to realize that there is price dispersion.” In other words, ...
The CFPB’s latest fair lending report to Congress, quietly distributed earlier this month, indicates that two mortgage issues will stay on the agency’s front burner: redlining and servicing. On the redlining front, the CFPB said it will “work to evaluate whether lenders have intentionally discouraged prospective applicants in minority neighborhoods.” When it comes to servicing, the bureau indicated it will “determine whether some borrowers who are behind on their mortgage … payments have more difficulty working out a new solution with the servicer because of their race, ethnicity, age, or gender.” The agency continued: “We are committed to ensuring fair, equitable and nondiscriminatory access to credit by finding and eliminating discriminatory lending practices, and also by encouraging lenders to maintain ...
JPMorgan Chase Chairman and CEO Jamie Dimon recently called for national mortgage servicing standards as one key reform that will significantly increase the availability of mortgage credit to qualified borrowers. “Mortgage servicing is a particularly complex business in which the cumulative impact of regulations has dramatically increased operational and compliance risk and costs,” costs which get passed on to borrowers, he said in his annual letter to shareholders. However, “The most promising opportunity in mortgage servicing is to adopt uniform national servicing standards across guarantors, federal and state regulators, and investors,” Dimon noted. And Congress doesn’t have to get involved to address this. “In particular, the U.S. Treasury is well-positioned to lead key players in the mortgage industry (the CFPB ...
School Accrediting Body Wins One Against the CFPB. The U.S. Court of Appeals for the D.C. Circuit has upheld a district court ruling that a civil investigative demand (CID) issued by the CFPB against the Accrediting Council for Independent Colleges and Schools (ACICS) is unenforceable. This is a big deal, and not just as it relates to the bureau. “The decision represents the first time in decades that a federal appeals court has struck down an administrative subpoena issued by the federal government,” said Allyson Baker of Venable LLP, who served as one of the lead counsel for the firm on behalf of ACICS....
Investors Unite: “We’re encouraged to see that MBA has changed its position on both of these issues and we also note that in their [sic] paper, MBA acknowledges the role of the Federal Housing Finance Agency … in stabilizing the companies during the conservatorship.”
Arch Capital will issue its quarterly earnings this Wednesday, April 26. It will mark the first earnings release following the Arch Mortgage Insurance purchase of competitor United Guaranty…
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