Much of the historical discussion about the mortgage industry going fully digital and adopting e-mortgages has revolved around cost savings, greater efficiencies, validating compliance and other benefits. But at the end of the day, the biggest reason is that lenders’ customer base is increasingly focused on digital technology, and lenders need to go where the borrowers are. “That’s where the consumers are, right? Finally, everybody’s going online to shop for most of their products, and mortgages are starting to happen the same way,” said Tim Anderson, director of eServices for DocMagic, during a webinar last week sponsored by Inside Mortgage Finance. “They’re going out there looking for rates and pricing, they’re looking for real estate. If you want to capture that marketplace, you meet them out there in cyberspace.” Scott Stephen, president of the online division of Guaranteed Rate, noted...
Lenders and investors at the ABS East conference this week hit officials from the Consumer Financial Protection Bureau with a number of complaints about the agency’s mortgage rules. The bureau officials suggested that data will have more of an impact on policy changes than general complaints. Patrick Orr, a policy analyst at the CFPB, reiterated that the bureau is accepting feedback and considering changes or guidance for the TILA-RESPA Integrated Disclosure rule, special qualified-mortgage standards that apply to loans eligible for sale to the government-sponsored enterprises and aspects of the ability-to-repay rule, among other issues. A representative from one lender said...
The Consumer Financial Protection Bureau has put out some proposed guidance on the controversial matter of how much of the expanded data collected under the Home Mortgage Disclosure Act will be made available to the public. The bureau did not announce any delay in the effective date of the revamped HMDA rule, slated to take effect Jan. 1, 2018. First, the agency wants to exclude several of the loan-level data points from public disclosure, including the universal loan identifier, the application date, the date the financial institution took action and the property address. Also, it would shield the borrower’s credit score, the mortgage loan originator ID number and any result generated by an automated underwriting system. Additionally, the CFPB is...
Unless the Federal Housing Finance Agency acts soon, Fannie Mae and Freddie Mac will see their capital buffers fall to zero on Jan. 1, 2018. Having zero capital may not be a big deal, initially – but a new complication has arrived in the form of hurricanes Harvey and Irma. According to Tim Rood, chairman of The Collingwood Group, the government-sponsored enterprises are not looking at losses “that will cost tens of billions of dollars – but they don’t need to be. The capital buffer is small as it is. And if a credit event happens, it could wipe out the thin layer of capital they have in a hurry.” If Rood – a former Fannie executive – is correct, the GSEs might have...
Although flood insurance is required for Fannie Mae and Freddie Mac loans in designated flood areas, the recent hurricane activity in Houston and Florida has revealed that a number of borrowers didn’t have the coverage they were supposed to have. But getting to the root of the disconnect is complicated. Both government-sponsored enterprises said that it’s up to servicers to evaluate whether loans are in compliance with flood insurance requirements. But Fannie and Freddie said they also have their own systems in place to help ensure compliance. “Servicers are required...
Trade groups representing smaller mortgage lenders are asking the Trump administration for targeted regulatory relief for smaller independent mortgage bankers. In a joint letter to Treasury Secretary Steven Mnuchin this week, the Community Home Lenders Association and the Community Mortgage Lenders of America urged the administration to back legislation that would exempt independent mortgage lenders from the Consumer Financial Protection Bureau’s supervision, enforcement and third-party vendor audits. Support is also being sought for CFPB administrative action to provide such targeted relief. In June, Treasury issued...
The signors add: “We … believe the debate over recapitalizing a broken system distracts from the critical structural issues that Congress must address to ensure that the federally supported secondary market serves key, bipartisan objectives.”
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