The CFPB’s arbitration report to Congress “contains substantial methodological flaws and does not support a ban on arbitration clauses in consumer credit contracts,” law professors at the University of Virginia and George Mason University concluded in a recent study. “To the contrary, the data presented in the report show that consumers on balance are better off if they have the arbitration process available to them for dispute resolution,” they added. “Rather than relying on flawed methodology and inaccurate data, the CFPB should focus on the actual benefits arbitration provides to consumers.” Jason Scott Johnston, a law professor at UVA, and Todd Zywicki, a law professor at GMU, reviewed the bureau report for the Mercatus Center and determined that CFPB’s findings ...

The number of complaints that consumers filed with the CFPB about debt collection practices fell 9.6 percent from the first quarter to the second and plunged 53.3 percent at the six-month mark versus one year ago, a new analysis by Inside the CFPB found. The biggest banks among the top 50 companies as ranked by complaints all acquitted themselves well at the mid-year 2015 point compared with the year before. Most notable in this regard was Wells Fargo, which saw consumer gripes fall 74.7 percent.Top debt collection firms had a more mixed performance. On the one hand, Encore Capital Group saw consumer criticisms fall 67.2 percent year over year, and 14.9 percent quarter over quarter. But Enhanced Recovery Company ...

Former CFPB Deputy Director Steve Antonakes is the latest high level official at the bureau to cash in on his few years at the agency, taking a position as chief compliance officer for Eastern Bank, a full-service commercial bank headquartered in Boston. Antonakes, who most recently served as deputy director and as the associate director for supervision, enforcement and fair lending at the CFPB, brings 25 years of compliance, risk management and financial services experience to Eastern Bank. While at the CFPB, Antonakes served as its second-highest-ranking official and was responsible for the supervision of all banks and non-banks under the bureau’s jurisdiction and the enforcement of federal consumer protection and fair lending laws. Antonakes was appointed by successive governors ...

Get Your TRID On. The CFPB has put out a Know Before You Owe guide for real estate professionals to help them navigate the upcoming TILA/RESPA Integrated Disclosure rule, otherwise known as TRID. The guide spells out the major elements of the rule, such as the steps associated with closings, and provides an explanation of the new disclosures. Industry pros can download from the bureau’s website print-ready versions in Adobe Acrobat PDF format as well as pre-order printed copies from the U.S. Government Printing Office. TRID Drives ClosingCorp to Integrate With Savana’s Loan Origination Product. ClosingCorp, a San Diego-based residential real estate closing cost data and technology vendor for the mortgage and real estate services industries, has integrated its Loan ...

Issuers of non-agency MBS injected some variety into the market in recent weeks with a deal backed solely by non-qualified mortgages and improvements to the representations and warranties on a jumbo MBS. Lone Star Funds issued a $72 million non-agency MBS backed mostly by non-QMs originated by Caliber Home Loans, a lender owned by the private-equity firm. Bloomberg first reported on the deal, which was priced on Aug. 7. Details on COLT 2015-A have been...

Securitization industry participants raised concerns after an appeals court last week refused to hear an appeal of an earlier ruling that reversed the long-held federal preemption that nonbanks have relied on to keep securitized loans exempt from state usury laws. The U.S. Court of Appeals for the Second Circuit denied the appeal of Madden v. Midland Funding last week. No explanation was provided with the denial. The appeal was supported by the Structured Finance Industry Group and the Securities Industry and Financial Markets Association, among others. SFIG said...

Two more long-running legacy MBS lawsuits were resolved last week after defendants Goldman Sachs and Deutsche Bank separately agreed to settle with plaintiffs. The NECA-IBEW Health & Welfare Fund, a union pension fund in Decatur, IL, is seeking preliminary court approval of a $272 million settlement with Goldman Sachs on behalf of entities that purchased MBS issued by defendant GS Mortgage Securities and which Goldman underwrote. If approved, the settlement would put...

Investors have a lot more to worry about these days than the collateral damage stemming from problems in Greece and China and a bumpy U.S. stock market. Ratings analysts indicate some new energy-related risks – most notably earthquakes near “fracking” sites and a plunge in the price of oil – have emerged as potentially significant challenges to investors in real estate and to mortgage lenders. Analysts at Standard & Poor’s said in a recent client note that earthquakes in proximity to fracking sites introduce a unique risk factor into the investment equation for those with a stake in real estate located in affected regions. “In particular, determining whether or not earthquake coverage is...

The Mortgage Bankers Association urged the Basel Committee this week to abandon its “overly simplistic” proposal to add onto institutional balance sheets layers of risk-based capital for interest rate risk.

Mortgage lenders welcomed the FHA’s implementation of a new supplemental method for evaluating a lender’s performance while expanding eligible, underserved borrowers’ access to mortgage credit. But some say the new metric still doesn’t resolve lenders’ liability concerns. The FHA’s new supplemental performance metric will be used in tandem with the agency’s compare ratio, a measure used by FHA to compare a lender’s default and claim rate with those of its peers to determine whether a lender’s authority should be terminated. Due to the compare ratio being a comparison to one’s peers rather than to FHA’s risk tolerance, lenders have found it difficult to lend to borrowers with credit scores below 640 without running afoul of Neighborhood Watch. Commenting on the FHA’s proposed supplemental performance metric last year, the Mortgage Bankers Association said the compare ratio has created a ...