The latest supervisory highlights report from the CFPB found that mortgage lenders, banks and nonbanks alike, put the controversial TILA/RESPA Integrated Disclosure rule – TRID – into effect without much of a problem, more or less. “Initial examination findings and observations conclude that, for the most part, supervised entities, both banks and nonbanks, were able to effectively implement and comply with the Know Before You Owe mortgage disclosure rule changes,” the report stated. However, examiners did find some violations relating to the content and timing of loan estimates and closing disclosures. The problem, however, is that the CFPB does not indicate in these reports which lenders or how many of them may have been guilty of the infractions, so there’s no way ...

An undisclosed number of mortgage servicers continue to drop the compliance ball, according to the latest supervisory highlights report from the CFPB, issued last week. “In recent exams, examiners found that one or more servicers received incomplete loss mitigation applications and pre-approved borrowers for short-term payment forbearance programs based on those applications,” the report noted. “However, the servicer(s) did not notify borrowers of their right to complete the application and did not separately request other information needed to evaluate for all the other loss mitigation options offered by the owner or assignee of the loan.” Also, as the modification program neared its end, and before the short-term payment forbearance period concluded, the servicer(s) failed to reach out to affected borrowers ...

The CFPB has frequently failed to provide the mortgage industry with enough guidance to ensure proper compliance with its substantial outpouring of new rules and regulations, resulting in “regulation by enforcement” far too often, according to a new white paper issued by the Mortgage Bankers Association.“Director Richard Cordray has argued that the bureau’s enforcement regime provides ‘detailed guidance for compliance officers’ and that it ‘would be compliance malpractice for the industry not to take careful bearings from [consent] orders about how to comply with the law,’” the white paper pointed out. “Unfortunately, the reality is that the bureau’s enforcement program offers only fragmentary glimpses of how the bureau interprets the laws and regulations it enforces.” Instead of giving the ...

In remarks that “sure sounded like a campaign speech,” according to one long-time industry compliance attorney, CFPB Director Richard Cordray threw the mortgage industry under the bus, accusing it of causing the financial crisis and the Great Recession that followed. Two weeks ago, Cordray delivered the keynote address at the Ohio Land Bank Conference in Cleveland, the same day the Democrat Party primary debate for the Ohio gubernatorial race was held. Some political observers were watching to see if the director would give his speech, resign and then appear in the debate. They were disappointed.But that doesn’t mean Cordray won’t resign before his term ends in July to pursue a run for the governor’s mansion. He has until 4 p.m. ...

An industry switch to digital mortgage lending may be costly upfront, but it would have saved the industry a ton of money and aggravation had it been adopted a decade ago, and can help resolve investor anxiety about legal liability and ensure greater regulatory compliance going forward, according to industry experts.In a webinar last week sponsored by Inside Mortgage Finance, Tim Anderson, director of eServices for DocMagic, pointed out that, when it comes to complying with the CFPB’s TILA/RESPA integrated disclosure rule, proof of delivery can be a big issue with investors, and e-closings/e-mortgages can be a huge help in resolving the anxiety that stems from the use of paper documents. “Three-day delivery is a big deal, [including] acknowledgement ...

The CFPB got a split verdict in a recent ruling from the U.S. District Court for the Northern District of California in its legal tussle with Nationwide Biweekly Administration, of Greene County, OH, which stood accused of engaging in deceptive practices by misleading consumers through its Interest Minimizer mortgage payment program. The bureau won a $7.9 million civil penalty from the defendants, but lost on $74 million in sought-after restitution. “After carefully considering the sufficiency, weight and credibility of the testimony of the witnesses, their demeanor on the stand, the documentary evidence admitted at trial, and the post-trial submissions of the parties, the court finds that CFPB has adequately shown that some, but not all, of defendants’ challenged marketing statements ...

The CFPB’s much-criticized arbitration rule issued earlier this year took effect last week, as a successful vote in the Republican-controlled House of Representatives to overturn it failed to generate enough interest and support for a comparable move in the Senate. It’s likely that the massive Equifax data breach and the company’s seeming attempt to manipulate affected individuals to waive their rights to arbitration in order to sign up for free credit-monitoring services effectively killed what little interest senators may have had in following up on the House’s success. The failure is another blow to a political party that ostensibly controls the Senate, the House and the White House but is struggling to accomplish much legislatively, thanks in part to the ...

It Looks Like New HMDA Requirements Will Proceed. Earlier this year, the mortgage industry made a concerted push for either the CFPB, or failing that, Congress, to delay implementing all the new data collection and reporting requirements lenders will face under the Home Mortgage Disclosure Act regime.... Feds to Amend CRA Regs to Conform to CFPB’s HMDA Changes. The Federal Reserve, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency on Wednesday issued a joint notice of proposed rulemaking to amend their respective Community Reinvestment Act regulations, mostly to conform to the changes the CFPB made to Regulation C, which implements the Home Mortgage Disclosure Act....

Fifteen industry trade groups and other organizations sent a letter to Treasury Secretary Steve Mnuchin and GSE regulator Mel Watt late this week, reminding them that Fannie Mae and Freddie Mac should be reformed through legislation and not some type of recapitalization plan where Congress is cut from the equation.“We are increasingly concerned about efforts to derail comprehensive reform,” they write. “We urge both Treasury and Federal Housing Finance Agency to focus on continuing to work with Congress to end conservatorship through comprehensive, bipartisan, legislative reforms.” No specifics are provided regarding the derailment comment. Presently, there are no viable bills before Congress where a consensus on GSE reform might be reached.

Investors Unite, an advocacy group for GSE shareholders, criticized the Mortgage Bankers Association’s plan for GSE reform and stated that the trade group is promoting too-big-to-fail banks. The comments come after MBA President and CEO David Stevens blogged about the nine-year anniversary of the conservatorship earlier this month, and touted the benefits of MBA’s proposal for GSE reform. The group’s plan replaces the implicit government guarantee of Fannie Mae and Freddie Mac with an explicit guarantee. “In our plan, private capital would assume more risk, which would lessen the exposure of taxpayers during any economic headwinds,” he said. Stevens also went on to praise...