Lenders won a number of concessions from the Consumer Financial Protection Bureau last week when the regulator proposed rules for loan originator compensation. However, the proposal also includes significant provisions that would impact lender profitability and originator compensation. For firms currently offering compensation arrangements that would be prohibited by the proposal, the CFPB said its proposed prohibition on compensation based on transaction terms “may contribute to adverse selection ...

Plans to hasten the resolution of Fannie Mae and Freddie Mac through an amended preferred stock purchase agreement (PSPA) announced last week by the Treasury Department and the Federal Housing Finance Agency has elicited mixed responses from stakeholders. Views vary as to whether the new deal will actually benefit taxpayers or simply protect holders of government-sponsored enterprise debt. The revised agreement will speed up the reduction of both GSEs’ investment portfolios, from an annual rate of 10 percent to ...

Historically low mortgages rates have fueled a prolonged refinancing wave that helped provide lenders with an important revenue source during the financial crisis. But as refinancing activity wanes and home prices begin to stabilize, lenders need to plan for the coming purchase market to stay competitive and continue growing revenue. In this regard, St. Louis-based Mortgage Returns helps mortgage companies, banks and independent mortgage banks prepare for the transition to a purchase-driven business ...

Banks reported a modest decline in mortgage banking income during the second quarter of 2012, but the business continued to generate strong profits, according to a new analysis of call report data by Inside Mortgage Trends. Commercial banks, thrifts and bank holding companies reported a total of $7.91 billion in non-interest income from single-family mortgage banking activity during the second quarter. That was down 0.8 percent from the first three months of the year, but it still ranked ... [Includes one chart]

Mortgage bankers reported a downturn in loan production income during the second quarter that was offset partly by improved results from their mortgage servicing businesses, according to a new Inside Mortgage Trends analysis of earnings reports. A group of nine major lenders that collectively accounted for 62.6 percent of total home loan originations during the second quarter posted a combined $4.11 billion in mortgage production income for the three-month period. That was down 15.0 percent from ... [Includes one chart]

Lenders Compliance Group Inc., a mortgage risk management firm for mortgage lenders, has formally launched the Brokers Compliance Group, a full-service, mortgage risk management firm in the U.S., specializing in outsourced mortgage compliance and offering a full suite of services to residential mortgage brokers. “Together, Lenders Compliance Group and Brokers Compliance Group will build on existing tools, processes, experts, risk assessments, and resources to provide a ‘best practices’ approach to residential mortgage compliance,”...

The Conference of State Bank Supervisors has begun making available public state regulatory actions on the Nationwide Mortgage Licensing System Consumer Access online portal. In addition, NMLS Consumer Access now directly connects the public to state agencies for the purpose of submitting a consumer complaint on a state-licensed company or individual loan officer. This latest upgrade consolidates enforcement actions taken by state regulatory agencies against state-licensed companies and individuals in a single repository...

Consumer Financial Protection Bureau. Agency Creating Interactive Regulatory Forum. The Consumer Financial Protection Bureau is working with the Cornell University e-Rulemaking Initiative (CeRI) to make it easier for the public to comment on mortgage servicing proposed rules through a pilot project called Regulation Room (www.regulationroom.org). “Regulation Room provides an online environment for people and groups to learn about, discuss and react to selected rules proposed by federal agencies,”...

All nonbank residential mortgage lenders and originators now must be in compliance with the Financial Crime Enforcement Network’s final rule requiring the establishment of anti-money laundering programs and the filing of suspicious activity reports. On Feb. 14, 2012, FinCEN published in the Federal Register its final rule on anti- money laundering program and suspicious activity report filing requirements for residential mortgage lenders and originators. The effective date of this rule was April 16, 2012, and the...

Last week, the Consumer Financial Protection Bureau issued a proposed rule in the Federal Register that would amend Regulation Z and Regulation X to implement the Dodd-Frank Act’s amendments to the Truth in Lending Act and the Real Estate Settlement Procedures Act, respectively. Specifically, the bureau is proposing to amend Reg Z to implement the Dodd-Frank amendments that would expand the Home Ownership and Equity Protection Act to apply to more types of mortgage transactions. Under the proposed rule...