In a concession to concerns expressed by industry representatives, the CFPB recently announced it plans to issue a proposal sometime this month to make certain limited changes to its rule on international money transfers, as well as to extend the rule’s effective date until 90 days after the proposal is finalized.“Some regulated entities identified issues that pose practical challenges in implementing the new law,” the bureau said in announcing its intention to propose a narrow set of changes to the remittance rule. “The proposed changes would improve implementation of the new law while keeping the important new protections for consumers intended by the Dodd‐Frank Act,” the CFPB said.
Opponents of Elizabeth Warren as head of the CFPB will not only have to deal with the Massachusetts Democrat as a new member of the U.S. Senate during the 113th Congress, but also as a newly minted member of the Senate Banking, Housing and Urban Affairs Committee, which has legislative jurisdiction over the CFPB’s regulatory turf, numerous sources said. Warren reportedly received the strong support of Sen. Tim Johnson, D-SD, who is returning as chairman of the powerful committee, along with that of committee member Jack...
The anti‐predatory lending rules of the Dodd‐Frank Wall Street Reform and Consumer Protection Act – especially those related to mortgages and credit cards – are based on the theory of ‘behavioral economics.’ That in turn has produced a stronger kind of federal regulator, in the form of the CFPB, and in stronger consumer protection laws, according to a new legal abstract. “These new legislative and regulatory developments mark a shift from the ‘rational consumer’ theory that underlay the great disclosure statutes of the late 1960’s and early 1970’s, such as the Truth in Lending Act, and toward the rising influence of ‘behavioral economics’ as a guiding force in consumer protection,” explained Dee Pridgen, professor of law and social responsibility at the University of Wyoming College of Law. ...
In a development that might catch the attention of officials at the CFPB who are working on improving consumer disclosures under the Real Estate Settlement and Procedures Act and the Truth In Lending Act, more evidence has emerged that consumers aren’t very big on using TILA forms to comparison shop for mortgages.A new study from Fannie Mae found that nearly half of lower‐income respondents and more than a third of higher‐income respondents get quotes from only one mortgage lender. The survey also confirms findings in other reports that “a substantial portion of all consumers do not understand key mortgage elements.”
CFPB's Top Lawyer Lends a Hand. CFPB General Counsel Meredith Fuchs was reportedly named an adviser to the American Law Institute's project to create a "Restatement of the Law Third, Consumer Contracts," which had its first meeting on Nov. 30. Gail Hillebrand, the bureaufs associate director for consumer education and engagement, is said to have attended the meeting as a guest. The ALI's project could have major consequences for providers of consumer financial services and other companies that contract...
MBS industry groups generally support the Federal Housing Finance Agency’s plan to develop a single securitization platform and model pooling and servicing agreements for Fannie Mae and Freddie Mac. But they question whether a standardized system will for the non-agency MBS market or risk-sharing arrangements envisioned for the government-sponsored enterprises. The FHFA has been pushing the two GSEs to standardize their securitization operations in recent years, including uniform data delivery requirements, consistent servicing rules and, most recently, a new framework for seller representations and warranties that will go into effect in January. The agency wants...
New issuance of agency MBS jumped dramatically in November, hitting its highest monthly production volume in over three years, according to a new Inside MBS & ABS ranking and analysis. Fannie Mae, Freddie Mac and Ginnie Mae combined for a whopping $199.34 billion in new single-family MBS during November, a 46.4 percent jump from the previous month. It was the highest monthly agency MBS output since June 2009, when $232.13 billion of MBS were issued. The November surge may reflect...[Includes one data chart]
A new non-agency jumbo MBS from a subsidiary of Credit Suisse Group includes some key differences compared with Redwood Trust deals, while pumping life into the non-agency market. DLJ Mortgage Capital issued a $329.89 million non-agency jumbo MBS late last week via a private placement; it was the company’s third of 2012. CSMC Trust 2012-CIM3 received a AAA rating from Standard & Poor’s with credit enhancement of 5.85 percent on the top-rated tranche. The new Credit Suisse deal included...
A close comparative look at the stimulus activity of the Federal Reserve suggests its support of the MBS market delivers more bang for the buck to the overall U.S. economy than its purchase of Treasury securities, according to a top Fed official. “[B]uying MBS has a different effect on the constellation of credit-market rates than buying Treasury securities,” Fed Governor Jeremy Stein said in a speech. Taking a look at what happened in the credit markets in the wake of the Fed Open Market Committee’s Sept. 13 announcement of a new program to purchase an additional $40 billion a month of agency MBS, Stein found...
The Securities and Exchange Commission has quietly dropped an investigation of Wells Fargo in relation to certain MBS transactions that occurred during the recent financial crisis. In a recent SEC filing, Wells Fargo disclosed notification by the SEC staff on Nov. 20 that an investigation into possible investor fraud has been completed and that there would be no recommendation for any enforcement action. In February this year, the SEC served...
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