A California superior court last week ruled that Gov. Jerry Brown, D, illegally diverted more than $331 million from a landmark mortgage settlement fund to resolve a state budget deficit. The funds represented California’s share in the historic 2012 national mortgage settlement between federal enforcement agencies and 49 state attorneys general and the nation’s five largest mortgage servicers – Wells Fargo Bank, Bank of America, JPMorgan Chase, Citigroup and Ally Financial. The banks paid...

The revised consent orders include limitations on the acquisition of mortgage servicing rights outside of the banks' own originations and limitations on outsourcing servicing functions.

The final rule approved by the FDIC requires escrows for flood insurance to be implemented on a “tripwire” approach.

Industry Groups Urge Restructuring of CFPB. Wading into risky political territory, a number of industry groups last week urged Congress to support H.R. 1266, legislation that would revamp the governing structure of the CFPB. Submitting a statement for the record to the House Financial Services Subcommittee on Financial Institutions and Consumer Credit, the industry groups said consumers and the industry would be better served by changing the CFPB governance structure from a single director to a bipartisan five-person commission as used by other federal agencies. “The CFPB has tremendous authority to supervise a multi-trillion dollar industry, which as we have learned, can have incredible ramifications on our economy,” the statement said. “As such, it is imperative the CFPB remain stable ...

The changes allow eligible non-borrowing spouses with older Home-Equity Conversion Mortgages the potential to remain in their home following the death of the last surviving HECM borrower.

The VA maintained a sizeable lead in first-lien mortgage refinancing over FHA and private mortgage insurers in the first quarter of 2015 but yielded to both in purchase originations.

Some 90 lenders contributed mortgages to the Redwood MBS, led by First Republic Bank with an 11.7 percent share.

Lenders provided a few constructive suggestions while voicing frustration regarding state regulators’ data collection efforts.

There is good news for investors in private student-loan ABS these days, according to the latest market intelligence from industry analysts. Student loan performance was healthy in the first quarter, and more growth is expected going forward. Continued strong performance trends were seen in repayment, delinquencies and charge-offs for private student loans through March 31, 2015, according to the semi-annual private student-loan performance report from MeasureOne, which was released earlier this week. Among the key findings, year-over-year delinquencies continued...

First Tennessee Bank’s agreement with federal agencies to pay $212.5 million to resolve allegations of violation of the False Claims Act is the latest proof of the government’s unrelenting pursuit of FHA lenders over underwriting and quality control issues. The settlement once again demonstrates the federal government’s commitment to combat FHA fraud using the FCA to recover taxpayer losses, according to an analysis by Boston law firm Greene LLP. “[The Department of Housing and Urban Development] made a point of saying that this behavior is exactly what led to the financial crisis and housing market downturn,” Greene’s compliance attorneys said. HUD and the Department of Justice have vowed to continue to pursue and hold accountable lenders who put profits ahead of their customers and legal obligations, the attorneys added. According to the DOJ, First Tennessee, a regional bank, admitted ...