Consumer complaints to the CFPB fell by double digits in nearly every category during the fourth quarter of 2015, with total complaints down 20.1 percent for the period, despite the one area that showed an increase – prepaid cards – skyrocketing 242.1 percent, according to the latest analysis by Inside the CFPB. However, the lending industry’s performance vis-à-vis consumers generally deteriorated in most categories on an annual basis, the latest data from the CFPB consumer complaint database show.Leading the improved performance during 4Q15 was the student loan sector, which saw gripes drop by a huge 31.7 percent, followed by declines in the debt collection space (off 27.5 percent), and in the home mortgages and credit report categories, both of which saw ...

Technical Corrections to the TRID Made With No Fanfare. Over the holidays, the CFPB quietly made what it characterized as “non-substantial” technical corrections to its integrated mortgage disclosures final rule under the Real Estate Settlement Procedures Act (Regulation X) and the Truth in Lending Act (Regulation Z). The November 2013 publication of the bureau’s TRID rule in the Federal Register resulted in “several unintended deletions of existing regulatory text from Reg. Z and the official interpretations (commentary) in the Code of Federal Regulations (CFR) and, in one case, the omission of regulatory language in the TRID from the CFR,” said the CFPB. To correct the CFR, the bureau republished the deleted and omitted text, consistent with the agency’s intent in ...

CFPB Makes Annual Threshold Adjustments Per HMDA, TILA Regulations. Late last month, the CFPB issued two final rules regarding annual threshold adjustments under the implementing regulations for the Home Mortgage Disclosure Act and the Truth in Lending Act. Under the HMDA regulation, Reg. C, the asset-size exemption for banks, savings associations and credit unions will remain at $44 million. As a result, such institutions with assets of $44 million or less as of Dec. 31, 2015, are exempt from collecting HMDA data in 2016. “An institution’s exemption from collecting data in 2016 does not affect its responsibility to report the data it was required to collect in 2015,” the CFPB said. The rule became effective Jan. 1, 2016, and applies ...

The prospects for consumer ABS in 2016 are a bit mixed. Auto ABS – especially subprime – appear susceptible to the Federal Reserve’s promised raising of interest rates this year and beyond, but credit card ABS are strong and performing well. “Rising interest rates could pressure U.S. auto ABS transactions, especially first on subprime deals,” analysts at Fitch Ratings said in a recent client note. While they expect last month’s initial rate increase by the Fed to have only a marginal near-term impact on borrowers, they said the plan to raise rates gradually over four years could increase the monthly debt burden on auto loan borrowers. “Although the rate increases are expected to affect the entire market, Fitch believes...

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...

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...

Risk-retention requirements established by the Dodd-Frank Act for certain non-agency mortgage-backed securities took effect at the end of 2015. Industry analysts suggest that the requirements will have minimal impact on industry participants’ current practices. “Risk-retention rules will not affect overall residential MBS issuance levels because qualified mortgage issuers will be exempt from risk-retention rules, and non-QM issuers already retain risk,” according to analysts at Moody’s Investors Service ...

FHA lenders funded $12.3 billion in new Home Equity Conversion Mortgage loans during the first nine months of 2015, up a hefty 22.2 percent from the same period in the prior year, according to Inside FHA/VA Lending’s analysis of agency data. Likewise, HECM endorsements increased 17.3 percent to $4.5 billion in the third quarter from $3.9 billion in the prior quarter. This was the highest HECM endorsements have been since the second quarter of 2013, when they totaled $4.1 billion. Purchase loans accounted for 85.8 percent of all HECM originations over the nine-month period. The majority of borrowers favored adjustable-rate HECMs over fixed-rate HECMs, which accounted for only 14.8 percent of HECM transactions. In addition, the initial principal amount at loan originations totaled $7.3 billion, up from $4.6 billion midway through 2015. The volume increase is attributable to program changes implemented ... [1 chart]