The CFPB recently issued new guidance that warns mortgage brokers to avoid acting as mini-correspondents in an attempt to side-step consumer protection laws and disclose how much money they make on a transaction. The bureau is concerned that some mortgage brokers may be setting up arrangements with investors in which the broker claims to be a “mini-correspondent lender,” when in fact the broker is still essentially just facilitating a transaction between a borrower and a lender. In its new guidance, the agency sets out some of the questions the CFPB may consider in evaluating mortgage transactions involving mini-correspondent lenders in order to understand their true nature. This evaluation involves examining how the mini-correspondent lender is structured and operating. Among the ...

The CFPB filed a lawsuit in a federal district court last week against Frederick J. Hanna & Associates, based in Marietta, GA, and its three principal partners – Frederick J. Hanna, Joseph Cooling, and Robert Winter – accusing them of operating a debt-collection lawsuit mill that used illegal tactics to intimidate consumers into paying debts they may not owe. “The CFPB alleges that the firm operates like a factory, producing hundreds of thousands of debt- collection lawsuits against consumers on behalf of its clients, which mainly include banks, debt buyers and major credit card issuers,” the bureau said. Between 2009 and 2013, the firm filed more than 350,000 debt-collection lawsuits in Georgia alone, according to the CFPB. The bureau further alleged the ...

A new analysis by Inside the CFPB found that consumer complaints to the bureau about their mortgages fell sharply in the second quarter, which likely reflects a continued stabilization in the housing and mortgage markets. In 15 out of 16 metrics tracked, customer gripes declined by double digits, with the remaining metric showing only a modest rise year-over-year. And in terms of the sole metric that showed a slight rise – a 3.6 percent increase in criticisms about mortgage servicing year over year – even there the data show a double-digit improvement (20.6 percent) from the first quarter of 2014 to the second.However, upon closer examination, the data also reveal that the double-digit rates of decline in consumer complaints slowed during ...

The CFPB is now collecting consumer complaints about seven different segments of the financial services sector, and its latest cumulative report on the subject indicates the Dodd-Frank Act’s cop on the beat is only going to continue to expand its dragnet. So far, the CFPB is accepting complaints about credit cards (as of July 21, 2011), mortgages (Dec. 1, 2011), bank accounts and services (March 1, 2012), credit reporting (Oct. 22, 2012), money transfers (April 4, 2013), debt collection (July 10, 2013), and payday loans (Nov. 6, 2013). “The CFPB continues to work toward expanding its complaint handling to include other products and services under its authority, such as prepaid cards. Consumers may also contact the CFPB about other products ...

Small financial institutions are in favor of the CFPB expanding its small creditor exemptions in its final rules having to do with establishing a borrower’s ability to repay and escrow requirements for higher-priced mortgage loans. The Independent Community Bankers of America and a coalition of 45 state and regional banking associations urged the bureau to expand the exceptions for small creditors to ensure community banks can continue to meet their communities’ mortgage needs. In a joint letter, the organizations called on the CFPB to allow community bank loans held in portfolio for the life of the loan to automatically receive qualified mortgage safe harbor status and an exemption from the escrow requirements for higher-priced mortgage loans. The trade groups noted ...

Bureau Moves to Ensure Equal Treatment for Same-Sex Marrieds. The CFPB is synchronizing its internal policies with the U.S. Supreme Court decision in United States v. Windsor, striking down as unconstitutional Section 3 of the Defense of Marriage Act, which holds that the word ‘marriage’ means only a legal union between one man and one woman. According to a staff memorandum from CFPB Director Richard Cordray, the CFPB will regard a person who is married under the laws of any jurisdiction to be married nationwide for purposes of the federal statutes and regulations under the bureau’s jurisdiction regardless of the person’s place of residency. However, consistent with other federal regulatory agencies, the bureau will not regard persons who are joined ...

Nationstar Mortgage ranked first among non-agency MBS issuers, but its volume was tied to servicer advances.

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Over five years, Fannie and Freddie would be wound down, but would be allowed to be sold and recapitalized as private entities with different business plans.

The modest rebound in non-agency MBS issuance during the first three months of 2014 fizzled during the second quarter of the year, according to a new analysis and ranking by Inside MBS & ABS. A total of just $1.60 billion of non-agency MBS were issued during the second quarter, a 62.7 percent decline from the previous period. It was the lowest quarterly volume in new issuance since the financial crisis of 2008. On a year-to-date basis, new issuance was...