The mortgage servicing settlements the CFPB obtained with Ocwen, SunTrust Bank and Flagstar Bank have much to teach the rest of the industry about landmines to avoid. During a webinar sponsored last week by Inside Mortgage Finance, an affiliated newsletter, Allyson Baker, a former CFPB attorney and partner at the Venable law firm in Washington, DC, highlighted the importance of trends seen in the three enforcement cases. “Number one is the bureau’s and other law enforcement agencies’ ongoing joint monitoring of the space,” which suggests the industry is likely to see more joint enforcement actions in the future, Baker told event participants. The second important trend is the very large civil money penalties and restitution that are resulting in tens ...

CFPB eClosing Program Will be a Plus, Eventually. The eClosing initiative launched earlier this year by the CFPB will ultimately be beneficial to the mortgage industry, once all the big wrinkles are ironed out, according to analysts at DBRS, formerly Dominion Bond Rating Service. “Many of the elements that make up eClosings are already being used in other consumer and commercial loans (such as auto loans and equipment lending), so much of the process should be easy to replicate,” the analysts said in a client note last week. “However, it is the uniqueness of the mortgage industry that will present some challenges.” For instance, there are real estate statutes for real property, compared with the Uniform Commercial Code for personal ...

A sale of that size would greatly reduce the bank’s portfolio and would signal a strategy shift.

Two years ago, Ross’ WL Ross & Co. sold its mortgage banking operation, Homeward Residential, to Ocwen for $750 million in cash and convertible preferred stock.

Other changes include: providing flexibility for servicers to comply with certain force-placed insurance and periodic statement disclosure requirements.

Regarding Nationstar’s financial condition, Fitch previously referenced the financial condition of Fortress Investment Group, which owns 74 percent of the nonbank lender/servicer.

There’s a growing fear that the CSBS might move to increase capital standards for nonbank originators as well.

The subprime servicing business continued to decline during the third quarter of 2014, and the sector’s top player faces big challenges in trying to get any bigger. The supply of subprime mortgage servicing outstanding fell to an estimated $352 billion at the end of the third quarter, according to a new Inside Nonconforming Markets ranking. That was down 5.9 percent from the end of June and off 15.8 percent from a year ago. Ocwen Financial remained the top servicer ... [Includes one data chart]

The servicing transfer from Wells Fargo to Ocwen Financial that had been on hold for more than eight months was cancelled last week by the two firms. Scrutiny from the New York Department of Financial Services prompted Ocwen to place the transfer on hold in February. The transfer was first announced in January and would have involved servicing on non-agency mortgage-backed securities with an unpaid principal balance of $35.9 billion along with $3.3 billion in mortgages serviced for ...

The Consumer Financial Protection Bureau proposed new servicing requirements this week. Among other changes, the federal regulator proposed requiring servicers to offer loss mitigation to borrowers that have received a loan mod but are in danger of re-default. The CFPB’s servicing rules currently require a servicer to evaluate a borrower for loss mitigation only once during the life of the loan. The proposed rule would also set requirements for ... [Includes three briefs]