President Barack Obama’s original recess appointment of Richard Cordray as director of the CFPB was likely unconstitutional, according to the rationale the U.S. Supreme Court used late last month to unanimously declare the president’s nominees to the National Labor Relations Board out of bounds. Late last month, in NLRB v. Noel Canning, the SCOTUS ruled that the president’s Jan. 4, 2012, recess appointments to the National Labor Relations Board were invalid. Alan Kaplinsky, a practice leader with the Ballard Spahr law firm, explained the legal question in dispute this way: “The NLRB recess appointments were made on January 4, the day after a new session of Congress had begun with a pro forma January 3 session and two days before ...

The National Association of Mortgage Brokers is doing another survey of its membership to determine the amount of closing cost credits given back to consumers at closing during 2013 – part of a broader effort on the part of the trade group to persuade the CFPB to loosen aspects of its ability-to-repay rule. Last year, NAMB submitted a letter to the CFPB to detail the mandatory credits a broker is required to provide consumers when rate sheet pricing exceeds the broker’s contractually obligated Lender Paid Compensation agreement. NAMB contends that the mortgage broker community provides mortgage credits back to the consumer that range in the billions annually, thus stimulating the nation’s economy. In order to demonstrate this, NAMB polled a number ...

The CFPB got a public relations black eye last week when its Inspector General issued a report finding that renovation costs for the bureau’s headquarters in Washington, DC, now stand at a projected $215.8 million – $160.8 million more than the original estimate. “These estimated all-in costs include the $145.1 million obligated for construction, construction management, and General Services Administration fees, as well as $70.7 million for other items including A/E [architectural/engineering] services, rent for swing space, costs associated with moving, and additional renovation-related expenses,” the IG noted. According to the IG, the CFPB has formalized policies for budgeting and funding, as well as for approving major investments prior to obligating funds. “However, we noted that the approval of funding for ...

Consumer complaints to the CFPB continued their quarter-by-quarter rise and fall, but one strong message from second quarter data is that financial services providers of all types saw a big improvement in the sheer volume of gripes, a new analysis by Inside the CFPB found. Overall, criticisms fell by 14.8 percent in the second quarter compared to the first quarter. Of the eight categories of consumer criticisms we track, seven saw double-digit improvements in 2Q14, ranging from an 11.3 percent drop related to bank accounts, to an 18.5 percent fall having to do with home mortgages. The sole category that saw an increase in the period ended June 30, 2014, was money transfers, which saw a rise of a scant [with 3 charts] ...

As of May, only three of the loans were 30-days delinquent, with the other once-delinquent mortgages having returned to current status or paid off.

Investors that have bought stock – and debt instruments – in the MIs are anxious about the phase-in period for the capital standards.

Avalos’ resolution targets approximately 300 underwater private-label security loans that were made on homes “particularly concentrated in San Francisco’s historically black, Latino and Asian working class communities.”

Senate Banking Committee Approves HUD, FHFA IG Nominees. The Senate Committee on Banking, Housing and Urban Affairs recently approved the nomination of Julian Castro as the next secretary of the Department of Housing and Urban Development. Castro, D, is the incumbent mayor of San Antonio, TX. The panel also approved the nomination of Laura Wertheimer as inspector general of the Federal Housing Finance Agency. The Senate has yet to confirm their nominations. Meanwhile, HUD Secretary Shaun Donovan’s nomination for director of the Office of Management and Budget was approved by the Senate Committee on Homeland Security and Governmental Reform on June 25. FHA Policies on Arm’s Length Transactions and Compliance with State Laws. The FHA is developing guidance to address concerns that laws in certain states may conflict with its arm’s length transaction requirements for preforeclosure/short sales. Until the guidance is issued, FHA lenders should seek guidance and assistance from the FHA National Servicing Center in matters of ...

The FHA is seeking comment on two new sections of a proposed single-family handbook for mortgage lenders. The handbook is in development. Once completed, it will serve as the centralized source of current and future FHA policies. Agency staff is collating policies from several handbooks, rules, mortgagee letters, notices and other sources to incorporate into the handbook. The FHA is publishing two new sections, “Doing Business with FHA – FHA Lenders and Mortgagees” and “Quality Control, Oversight and Compliance,” for comment. The “Doing Business” section lays out the requirements for FHA lender approval, including eligibility requirements, application processes, operating requirements and post-approval changes. The section also contains the recertification process as well as processes for applying for ...

The issue of eminent domain is rearing its head again, compelling mortgage and securitization industry groups to once more mobilize their resources to deep-six the latest initiatives. The most recent manifestation of a resurgent interest in eminent domain is in California, where John Avalos, a member of the San Francisco Board of Supervisors, has sponsored a resolution seeking to enter the city into a joint powers authority agreement with Richmond, CA, a vehicle by which both cities could seize underwater but performing mortgages using eminent domain. Avalos’ resolution targets...