A new study from the Government Accountability Office has confirmed that the CFPB can monitor banks for their mortgage servicing compliance with the terms of settlements that were reached before the bureau received its full authorities with the appointment of a confirmed director. The degree to which the CFPB has actively done so, however, appears to be limited. The GAO study at issue concerned the consent orders the Office of the Comptroller of the Currency and the Federal Reserve reached with 16 mortgage servicers back in 2011 and 2012. Those agreements required the servicers to hire consultants to review foreclosure files for errors and to remediate harm to borrowers. The CFPB was established on July 21, 2011, and the first...
FSOC Suggests State Regulators Work With CFPB on Nonbank Servicer Issues. The Financial Stability Oversight Council – of which the CFPB is a member – recommended last week that state regulators collaborate on prudential and corporate governance standards to strengthen nonbank servicers. The FSOC said state regulators should work on the standards with the CFPB and the Federal Housing Finance Agency when appropriate. The CFPB and state regulators have some authority over these companies, FSOC noted, but many of them are not currently subject to prudential standards such as capital, liquidity or risk management oversight. Additionally, in a number of cases, mortgage investors’ ability to collect on mortgages is dependent on a single mortgage servicing company, where failure could have significant negative...
Among the changes, the two GSEs will no longer require that a lender automatically repurchase a residential loan when a mortgage insurance company rescinds coverage.
Non-QM mortgages will exist throughout the credit spectrum, according to Mitch Hochberg, a partner at Fenway Summer and general counsel at Ethos Lending, a start-up wholesale mortgage originator.
It’s now believed that the legislation will clear the committee, but Majority Leader Harry Reid will not allow it to move any further because of weak support overall.
The sphere of mortgage lending that will exist outside the parameters of the qualified-mortgage standard established by the Consumer Financial Protection Bureau represents an attractive opportunity for both lenders and bond buyers, but skittish investors need to be won back before they return and participate to any significant degree. That was one of the key take-aways from a webinar sponsored this week by Inside Mortgage Finance, an affiliated publication. Non-QM mortgages will exist...
Over the past 10 days, MBS prices have risen by roughly 50 basis points. Since early April, prices have jumped 150 basis points, based on the Fannie Mae 4s, catching market participants off guard. Joe Farr, director of sales for MBSQuoteline, noted, “The expectation was that everyone thought bond prices would fall.” But it hasn’t turned out that way, even with the Federal Reserve continuing to taper its investment in MBS. The problem in the MBS market continues...
A New York federal judge has given preliminary approval to a $280 million settlement proposed by JPMorgan Chase to investors who claimed they were misled into buying $36.8 billion of non-agency MBS, ending a long-running, consolidated class-action suit. U.S. District Judge Pamela K. Chen granted initial approval late last week to the settlement with investors led by the Public Employees’ Retirement System of Mississippi. The Mississippi pension plan sued...
There are some potential problems with the evolving peer-to-peer lending sector that need to be resolved before ratings can be assigned to the securitization of such assets, according to Standard & Poor’s Ratings Services. To start to get a handle on this emerging sector, it is important to understand P2P companies’ specific strategies and their target demographic of borrowers and investors. “Platform operators in the P2P lending sector are...
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