Although the Consumer Financial Protection Bureau recently issued a “clarifying” letter on errors tied to the so-called TRID integrated disclosure rule, deep concerns remain among originators that fund non-agency product for sale into the secondary market. Moreover, according to interviews conducted by Inside Mortgage Finance over the past week, some nonbank lenders are seeing noticeable increases in origination costs because loans are taking longer to close and therefore remain on warehouse lines for an extended period of time. Because nonbanks fund almost all of their production using warehouse credit, the implication boils down...
Mortgage industry representatives are meeting this week with Consumer Financial Protection Bureau Director Richard Cordray in another attempt to squeeze out additional clarification to help lenders comply with the bureau’s integrated disclosure rule, which took effect Oct. 3, 2015. The ambiguity and confusion engendered by the rule continues to contribute to mortgage closing delays throughout the country, according to many top industry officials. Executives of the Independent Community Bankers of America were scheduled...
Quicken Loans is considering its next move – possibly a change of litigation venue – following last week’s ruling by a Michigan federal district court dismissing the lender’s lawsuit against the Department of Housing and Urban Development and the Justice Department for failure to state a claim. The lawsuit, which challenged the DOJ’s use of the False Claim Act and HUD’s use of statistical sampling in post-endorsement loan reviews, was filed in April 2015, a week before the DOJ sued Quicken for allegedly filing false claims on FHA mortgages and other violations. Quicken’s lawsuit claimed...
A surge in sales of mortgage servicing rights by banks to nonbanks is likely over, according to industry analysts. As regulatory oversight remains a concern, the use of subservicing is expected to increase, with troubled loans handled by specialists. “The frequency of MSR transfers will remain low, even though buyer interest in MSR transfers may rise from 2015 levels,” according to analysts at Moody’s Investors Service. Analysts at Bank of America Merrill Lynch added...
It’s too soon to tell whether marketplace lending will disrupt traditional mortgage lending, but analysts such as Freddie Mac economist Sean Becketti predict that the alternative, Internet-based lending structure will have an impact. “Will marketplace lenders become an Uber-like disruptive force in consumer lending, or are they simply old-fashioned consumer lending dressed up for the Internet?” asked Becketti. “It's too soon to tell.” But the swift growth of the industry, coupled with its emphasis on Internet outreach and novel underwriting practices, has led...
Radian Guaranty became the first among seven private mortgage insurers to declare compliance with the regulatory capital standards under the Private Mortgage Insurer Eligibility Requirements (PMIERs), while other MIs expressed confidence they will meet those same requirements. Radian met its PMIERs goals after receiving $325 million in cash and marketable securities from its parent Radian Group in exchange for a surplus note. In addition, the parent firm contributed $50 million to an exclusive affiliated reinsurer of Radian Guaranty. Radian Group expects...
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