The full House of Representatives is expected to vote sometime this week on legislation that would provide a regulatory and legal safe harbor for mortgages originated under the CFPB’s Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure (TRID) rule until Feb. 1, 2016. Speaking of the legislation at issue, H.R. 3192, the Homebuyers Assistance Act, House Majority Leader Kevin McCarthy, R-CA, said, “This bipartisan bill provides certainty to businesses that are trying to comply with the rule as well as an opportunity to work out any implementation issues that come up.” One industry observer who anticipates a “big margin” vote indicated he expects the bill will split rank-and-file Democrats from their caucus leadership. Meanwhile, industry readiness continues to ...

Real estate, title and mortgage industry groups are doing more than lobbying Congress and the CFPB for relief when it comes to compliance with and enforcement of the bureau’s Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure (TRID) rule. They are also continuing to work hard to get their own respective memberships as up to speed as possible before examiners show up on their doorsteps. For instance, the American Bankers Association sent a letter to member CEOs last week to assist executive management and line business managers in decision making as the industry completes final arrangements to comply with TRID. “Bankers are making assessments of systems readiness, staff training, capabilities of settlement services providers, and potential compliance risk ...

Last week, the Republican-controlled House Financial Services Committee passed H.R. 1266, the Financial Product Safety Commission Act of 2015, which would replace the CFPB’s sole director with a bipartisan, five-member commission. In the run-up to the vote, a number of industry groups came out in support of such a bipartisan leadership structure for the bureau, noting in an op-ed in The Hill newspaper that then-professor Elizabeth Warren and the Obama administration both envisioned a pro-consumer regulatory agency with just such a commission. And in a letter to the committee leadership, a number of the groups made that same point while also noting such a commission leadership structure had the support of two key Democrats during the passage of the Dodd-Frank ...

Mortgage Bankers Association President and CEO David Stevens again called for formal guidance from the CFPB on the legitimacy of marketing services agreements in the wake of some recent troubling developments after the bureau assumed enforcement of the Real Estate Settlement Procedures Act as a result of the Dodd-Frank Act. Speaking at the MBA’s recent 2015 regulatory compliance conference in Washington, DC, Stevens told a crowd of attendees, “We sent a letter to [CFPB] Director [Richard] Cordray weeks ago asking that the bureau simply clarify whether MSAs are considered acceptable and what constitutes an acceptable [agreement] if that’s the case. That was our question. We’re not saying we’re for them, against them; just please tells us if we’re going to ...

The CFPB and the Department of Justice Thursday brought a $33.75 million redlining enforcement action against Hudson City Savings Bank, accusing the institution of denying residents in majority black and Hispanic neighborhoods fair access to mortgage credit. The joint action alleges that Hudson City illegally avoided and thereby discouraged consumers in majority black and Hispanic neighborhoods from applying for credit by avoiding locating branches and loan officers in such communities and by not using mortgage brokers in such neighborhoods as well. The government also accuses the bank of excluding majority black and Hispanic communities from its marketing strategy and from credit assessment areas. Under the terms of a proposed consent order pending before a court, Hudson City would have to ...

Last week, the CFPB announced it had brought two separate actions against Cincinnati, OH-based Fifth Third Bank, one for alleged discriminatory auto loan pricing and another for alleged illegal credit card practices. In the auto-lending enforcement action, the bureau and the Department of Justice alleged that the bank violated the Equal Credit Opportunity Act by charging African-American and Hispanic borrowers higher dealer markups for their auto loans than non-Hispanic white borrowers. They also asserted that Fifth Third’s allegedly illegal discriminatory pricing and compensation structure meant thousands of minority borrowers from January 2010 through September 2015 were charged, on average, over $200 more for their auto loans. The CFPB and DOJ action requires Fifth Third to change its pricing and compensation ...

Late last week, the CFPB brought a $48 million enforcement action against Los Angeles-based Westlake Services, an indirect auto-finance company, and Wilshire Consumer Credit, its auto-title lending subsidiary, for allegedly pressuring borrowers using illegal debt collection tactics. Westlake Services specializes in purchasing and servicing auto loans, including many subprime and near-prime loans. Wilshire Consumer Credit offers title loans directly to consumers, largely via the Internet, and services those loans. Wilshire also purchases and services title loans made by others. The bureau accused the companies of deceiving consumers by calling under false pretenses and using phony caller ID information, falsely threatening to refer borrowers for investigation or criminal prosecution, and illegally disclosing information about debts to borrowers’ employers, friends and family...

The CFPB recently issued some final changes to its mortgage rules to help foster responsible lending by small creditors, especially those operating in rural and underserved areas. The new rule, which was proposed in January, aims to increase the number of community banks and credit unions that are able to offer certain types of mortgages in rural and underserved areas. It also gives small creditors time to adjust their business practices to comply with the rules. “The financial crisis was not caused by community banks and credit unions, and our mortgage rules reflect the fact that small institutions play a vital role in many communities,” said CFPB Director Richard Cordray. “These changes will help consumers in rural or underserved areas ...

The CFPB, the Department of Education, and the Department of the Treasury late last week issued a joint statement of principles “to improve student loan servicing practices, promote borrower success and minimize defaults.” The agencies said they are committed to working together so that all student loan borrowers have access to the information they need to repay their loans responsibly and avoid default, and to protections so that they will be treated fairly even if they are struggling to repay their loans.They also want student loan borrowers to have access to certain mechanisms so that “errors are resolved expeditiously, and assurances that student loan servicers, both in the marketplace and through federally-contracted companies, are held accountable for their conduct.” ...

Industry Anxiety at a Fever Pitch? Or Just Good Public Relations? The new TRID rule, which became active on Saturday, may only be the tip of the regulatory iceberg, according to sister publication IMFnews. Several lenders interviewed readily admitted that the new TILA/RESPA disclosures are definitely easier to understand. That’s the good news. “The bad news is that they feel the CFPB continues to miss their central message: that incorporating technology changes to their systems to make TRID happen on time has been an operational nightmare, and they feel that Director Richard Cordray has been hardly sympathetic to their plight,” the publication reported late last week. Although the TRID headache may be eased (for now) thanks to a letter that ...