CFPB Director Richard Cordray issued a letter to the mortgage industry over the holidays related to the TRID integrated disclosure rule, clarifying that the new rule includes a provision to “cure” certain mistakes, even after the fact. “The Know Before You Owe mortgage disclosure rule provides for the issuance of a corrected closing disclosure, even after closing,” Cordray said in a letter to Mortgage Bankers Association President and CEO David Stevens. “This can be used, for example, to correct non-numerical clerical errors or as a component of curing any violations of the monetary tolerance limits, if they exist. “As a general matter, consistent with existing Truth in Lending Act principles, liability for statutory and class action damages would be assessed ...

The latest Campbell Surveys/Inside Mortgage Finance HousingPulse survey provides further anecdotal evidence to support the claim that the TRID rule is in fact contributing to delays in closing mortgages. “TRID rules caused delay of about 10 days,” thanks to “new processes for title and lender,” said one real estate agent in California. Another in North Carolina said, “Lenders do not communicate well with real estate agents. With TRID now in effect, I feel like I am flying blind trying to organize, coordinate and keep things on track.” A third in New Hampshire noted, “We had four more closings expected to close in November but are delayed due to TRID. Some had 60-day closing dates and have been extended up to ...

Initial mortgage lending industry anxieties that the CFPB’s integrated disclosure rule might cause problems on the secondary market are being borne out, at least on an anecdotal level, a number of industry officials and participants indicate. Mortgage Bankers Association President and CEO David Stevens last week rattled off a handful of such problems that have emerged since the TRID rule took effect Oct. 3, 2015. “For non-agency jumbo mortgages, there are some pretty significant kick-backs [of loans] from a couple of investors,” said Stevens. Part of it has to do with the due diligence firms that simply identify errors and some investors who have a zero tolerance for any error regardless of severity. “This does not apply to all,” Stevens ...

Some private investors are skittish about purchasing loans in the new TRID environment because of the potentially huge, and largely unspecified, liability that purchasers face on the secondary market under the bureau’s new integrated disclosure rule, according to some top experts. “What we’re seeing now, unfortunately, is that private investors, securitizers and such, are being gun-shy,” said Richard Andreano, mortgage banking practice leader in the Washington, DC, office of the Ballard Spahr law firm, during a recent webinar sponsored by Inside Mortgage Finance, an affiliated publication. “Because what we have is the bureau made clear that there was some liability associated with the TRID rule, not only pre-existing Truth in Lending Act liability, but perhaps now some liability for Real ...

The CFPB last week announced it wants public feedback on the resubmission of corrected mortgage lending data reported under the Home Mortgage Disclosure Act. In October 2015, the CFPB finalized its HMDA rule that significantly expands the range of data will that be reported after becoming effective in 2018, with reporting beginning in 2019. “Given these changes, the current resubmission guidelines may need to be updated, and the bureau is seeking feedback on what modifications may be appropriate,” the agency said. Also, some industry stakeholders have asked whether the CFPB would adjust its mortgage lending data resubmission guidelines to reflect the expanded data that will be submitted under the new rules. The bureau’s request for information (RFI) lists a dozen ...

The CFPB’s new rulemaking related to the Home Mortgage Disclosure Act sets the stage for a more comprehensive regulatory environment in which a single mortgage could be monitored as it moves between lenders, is packaged into a security, or is handed off from one servicer to another, according to a new report from the Treasury Department’s Office of Financial Research. For those who may have missed it, in October 2015, the CFPB revised the reporting requirements under HMDA to include a universal loan identifier (ULI) and the postal address of the property securing each mortgage loan. The revisions also require a legal entity identifier (LEI) for the reporting entity and loan originator and the inclusion of data fields to monitor ...

The CFPB’s ability-to-repay (ATR) rule with its qualified mortgage standard did not materially affect the mortgage market in 2014, according to a recent analysis by two economists at the Federal Reserve based on industry data provided under the Home Mortgage Disclosure Act. Following up on an article published simultaneously with the 2014 HMDA data release in which they found little indication that the new rules had a significant effect on lending in 2014, Fed economists Neil Bhutta and Daniel Ringo extended that analysis by conducting sharper tests around the date of enactment, and around lender-size and loan-pricing thresholds, where treatment of loans under the new rules varies. They found that “lenders responded to the ATR and QM rules, particularly by ...

The Government Accountability Office heard a lot of industry talk about the negative effects of CFPB regulations on mortgage lending during its review of the impact of the Dodd-Frank Act, but found little data from regulators to support such claims so far, according to a new report issued by the government watchdog. “The results of surveys conducted by regulators, industry associations, and academics on the impact of the Dodd-Frank Act on small banks suggest that there have been moderate to minimal initial reductions in the availability of credit among those responding to the various surveys, and regulatory data to date have not confirmed a negative impact on mortgage lending,” said the GAO. Some community bank, credit union, and industry association ...

The CFPB is apparently disturbed by recent press accounts of possibly discriminatory lending practices by Vanderbilt Mortgage and Finance, a lending arm for the mobile home builder Clayton Homes, both of which are part of Warren Buffett’s Berkshire Hathaway Company. “The allegations of discrimination and predatory practices raised by the reporting are obviously very concerning to the bureau,” said Sam Gilford, a spokesman for the CFPB. Bureau officials would not comment further. In recent weeks, The Seattle Times and BuzzFeed used data from the Home Mortgage Disclosure Act to claim that Vanderbilt Mortgage, a manufactured housing lender owned by Clayton, consistently originates loans with higher interest rates for minorities compared with interest rates on loans the company originates for white ...

Consumer complaints to the CFPB fell by double digits in nearly every category during the fourth quarter of 2015, with total complaints down 20.1 percent for the period, despite the one area that showed an increase – prepaid cards – skyrocketing 242.1 percent, according to the latest analysis by Inside the CFPB. However, the lending industry’s performance vis-à-vis consumers generally deteriorated in most categories on an annual basis, the latest data from the CFPB consumer complaint database show.Leading the improved performance during 4Q15 was the student loan sector, which saw gripes drop by a huge 31.7 percent, followed by declines in the debt collection space (off 27.5 percent), and in the home mortgages and credit report categories, both of which saw ...