Emerging eClosing technology may make borrowers a little smarter, according to the Consumer Financial Protection Bureau, but it isn’t easy for lenders to implement. A CFPB report on the agency’s eClosing project found that borrowers who participated in the pilot scored slightly higher in a quiz on the closing process than did those who relied on good-old paper. The eClosers were...
Appraisal independence requirements adopted by the government-sponsored enterprises helped reduce the probability of inflated appraisals and made it more difficult to obtain mortgages, according to new research by staff at the Federal Reserve Bank of Philadelphia. Lei Ding, a community development economic advisor at the Philadelphia Fed, and Leonard Nakamura, a vice president and economist, detailed their findings in a paper published at the end of July. The government-sponsored enterprises adopted...
Student loan debt is no joke in America – and mortgage bankers, in particular, know all about it, especially since it’s being singled out as the chief reason why some borrowers can’t afford to buy their first home. Each year, a new group of college graduates has to start figuring out how to pay off their student loans. There’s even a website dedicated to showing the national student debt in real time – roughly $1.2 trillion as Inside Mortgage Trends went to press – along with credit card debt and auto loans. Currently, 15 percent of mortgagors have...
Processing times for income verification provided by the Internal Revenue Service have slowed in recent months, causing problems for lenders. The IRS pinned the delays on budget cuts, prompting the Mortgage Bankers Association to call for an evaluation of the “true cause” of the delays. The IRS charges $2 per request to provide a taxpayer’s tax transcript to lenders via a third-party vendor. Stephen O’Connor, a senior vice president of public policy and industry relations at the MBA, said historically, the turn time for the Income Verification Express Service program has been around two business days or less. “In recent months, however, lenders have reported...
Although PHH Corp. refuses to answer questions regarding a key private-label services contract to originate mortgage loans for Merrill Lynch, most analysts that follow the company believe the Wall Street giant will renew the agreement. To date, PHH will not say either way, but observers of the situation believe it’s more a technical matter than anything else. The general consensus is that Merrill has verbally agreed to renew, but hasn’t signed on the dotted line. On its recent earnings call, PHH management said...
Nonbank mortgage lenders are starting to complain more loudly about the length of time it takes to get their loan officers approved to do business in New York state, quoting approval times that can take anywhere from 90 to 120 days – and that’s for an application with no “red flags.” A mortgage consultant who works closely with nonbanks estimated that some of his LO clients have waited as long as six months, including both new LOs and bank loan officers who are transferring to a nondepository. Requesting anonymity, he said...
M&T Bank is attempting to reach a settlement with the Department of Justice to resolve an investigation into the bank’s origination of FHA loans and sales of conventional-conforming mortgages to Fannie Mae and Freddie Mac. The bank disclosed the investigation in its quarterly filings with the Securities and Exchange Commission, noting similar ongoing investigations at other financial institutions. A bank spokesman declined to comment beyond what was disclosed in the SEC filing but noted that the government agencies are conducting one investigation. On the FHA side, DOJ and the Department of Housing and Urban Development’s Office of the Inspector General are investigating...
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