A handful of leading industry trade groups told the CFPB they generally support the agency’s recent interim final rule that clarifies the proper compliance with mortgage servicing requirements when a consumer is in bankruptcy or sends a cease communication request under the Fair Debt Collection Practices Act. The interim final rule, issued Oct. 23, 2013, amends some of the mortgage servicing-related provisions in Regulation X (the Real Estate Settlement Procedures Act) and Regulation Z (the Truth In Lending...
The scope of the ability-to-repay/qualified mortgage final rule released earlier this year by the CFPB will make it more difficult for borrowers to obtain loans and tighten already-strict underwriting standards, according to analysts at Standard & Poor’s Ratings Services. “We anticipate that the rule will prevent many of the types of loosely underwritten mortgages that caused systemic risk during the 2006 and 2007 origination period, but may do so at the expense of limiting credit access – sometimes to qualified borrowers,” they...
The CFPB has gone ahead and issued the last big piece to the mortgage finance puzzle it was mandated to manufacture by the Dodd-Frank Act, the integrated mortgage-disclosure rule under the Real Estate Settlement Procedures Act and the Truth in Lending Act and related forms. The good news for the mortgage finance industry – apart from the 20-month implementation period – is that the new rule and forms, part of the bureau’s “know before you owe” initiative, are not nearly as “transformational” towards the fundamental nature of the...
Standard & Poor’s recently published an updated estimate of likely losses stemming from mortgage-related litigation, finding that banks face future costs of $56.5 billion to $104 billion.
The GSEs are beginning to take in a significant amount of money from R&W settlements, but both stand to reap an even larger windfall from a pending civil lawsuit filed by the FHFA against 17 issuers of private label MBS.
Meanwhile, the regulator Monday morning unveiled new “master policy” requirements for the MI industry, which will make it harder for insurance firms to get out paying claims on defaulted mortgages.
The Department of Veterans Affairs has provided VA lenders a table for determining the appropriate and maximum cost of legal services for each preferred method for foreclosing in judicial and non-judicial states. Specifically, the table concerns the maximum attorney fees the VA will allow in calculating the payment of loan guaranty claims upon termination of the VA loan. It reflects the amounts the VA has determined to be reasonable and customary for all states, following an annual review of amounts allowed by other government-related home loan programs. Every year, the VA ...
Imprecise rules, triple-damage claims and increasingly political enforcement of agency rules could make it more dangerous for lenders to do business with the FHA than to originate non-qualified mortgage loans, according to a top compliance expert. Larry Platt, a partner with K&L Gates, said that when lenders originate and underwrite FHA loans they are subjected to rules that are unevenly applied and politically enforced. It is a prescription for a financial bloodbath, especially if you add to it the False Claims Act and the Financial Institutions Reform, Recovery and Enforcement Act, he added. Throwing the Department of Justice into the mix ...
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