Consumer complaints to the CFPB fell in most financial service product segments during the first quarter, not only from the previous quarter but also from one year ago, according to the latest analysis of bureau data by Inside the CFPB. Total gripes in the first quarter of 2015 declined 8.2 percent from the fourth quarter of 2014, and slid 17.0 percent compared to the first quarter of 2014. Once again, consumer criticisms about residential mortgages led the decline in both timeframes, dropping 20.3 percent quarter over quarter and plunging 33.5 percent year over year. The fall-off is likely due to the shrinkage in overall mortgage originations as well as the continued recovery in the overall housing and mortgage markets.The [with exclusive data chart] ...

CFPB Deputy Director Steven Antonakes revealed recently that the bureau is increasingly concerned about the subprime auto finance sector and will crack down on any practices that prove to be too risky for consumers. Speaking at an event of the Consumer Bankers Association, Antonakes identified a loosening of credit in the subprime auto loan market as one of the emerging risks the bureau is paying close attention to. “From our standpoint, it is not inherently troubling that more consumers are getting auto loans; under the right conditions, increased access to credit is good for the economy and individual upward mobility,” the deputy director said. “However, we have noticed some trends in connection with this credit expansion that give us cause ...

The CFPB brought an enforcement action against National Corrective Group, a nationwide debt collection operation based in San Clemente, CA, and CEO Mats Jonsson, accusing them of using deceptive threats of criminal prosecution and jail time in order to intimidate consumers into paying debts for bounced checks. The bureau also accused the company of misleading consumers into believing they have to sign up for a costly financial education program to avoid criminal charges. The CFPB complaint also alleges that National Corrective Group created a false impression for consumers that its communications were from a state or district attorney’s office. “The company sent letters on prosecutors’ letterheads that appeared to be signed by the state or district attorney,” the bureau said...

Some of the top mortgage lenders in the United States plan to move up their consumer disclosure- related processes even more than the CFPB is requiring under its integrated disclosure rule, which takes effect Aug. 1, 2015. It looks like they are just trying to be conservative and provide a bit of a cushion, at least in the initial transition period to a revamped disclosure regime. Bob Kelly, head of Truth in Lending Act/Real Estate Settlement Procedures Act implementation at Bank of America, told Inside the CFPB, “One thing that I think the CFPB sought to really have is that customers know before they owe. From a customer perspective, they often felt that the process to close was hurried and ...

It’s Time to Scale Back Dodd-Frank, Industry Says. With a new Republican majority now in power and calling the shots on Capitol Hill, the industry consultants at The Collingwood Group recently asked mortgage industry officials what they thought the new Congress could do to bolster the housing market. Their answer? Rein in Dodd-Frank. “Although just fewer than 50 percent of respondents selected ‘repeal Dodd-Frank’ or ‘abolish the CFPB,’ the comments submitted clearly indicate that these industry insiders prefer a tempered approach with reasonable modifications to these two reactionary reform measures stemming from the crisis,” Collingwood said. “Many respondents stated that the Dodd-Frank Act should be revised to remove barriers to innovation and to reduce the cost of manufacturing a mortgage.” ...

Concerns about how borrowers will be impacted by a change in servicers go beyond mortgages in non-agency MBS. Analysts at Moody’s Investors Service warn that the decentralized servicing models used for consumer loan ABS issued by Springleaf Holdings and OneMain Financial face significant risks in the event that servicing needs to be transferred. Both Springleaf and OneMain originate consumer loans at local branches, where they conduct certain servicing operations and collections. The decentralized model can help boost originations and loan performance, though there are risks for investors in consumer ABS with decentralized servicing. “As long as the originator maintains the customer relationship and local presence, this ‘high-touch’ model can help...

Fitch Ratings has issued a report updating its standards for rating residential MBS under the ability-to-repay and qualified mortgage rules that went into effect early last year. Issued by the Consumer Financial Protection Bureau, the rules outline a set of underwriting criteria, which, when met for a particular loan, protects the lender from any undue litigation risk and provides a safe harbor for the loan. The rules affect...

Originations of loans that don’t meet standards for qualified mortgages have been off to a slow start but officials at Impac Mortgage Holdings suggest that non-QM lending is poised for growth. Joseph Tomkinson, Impac’s chairman and CEO, said the government-sponsored enterprises’ dominance of mortgage originations has limited non-QM originations. “We knew going into this that it would be a slow growth,” he said this week during a call with investors ...

Non-qualified-mortgages accounted for 1.8 percent of mortgages originated in the fourth quarter of 2014 by 22 lenders surveyed by the National Association of Realtors. NAR noted that most of the lenders in the survey don’t portfolio their originations, which could skew the non-QM share significantly lower compared with lenders that hold non-QMs in portfolio. Some 5.0 percent of originations by lenders surveyed by NAR in the third quarter of 2014 were non-QMs ... [Includes three briefs]

The integrated disclosure rule from the Consumer Financial Protection Bureau continues to shake up the mortgage industry months before it even takes effect. Particularly unsettled are settlement agents, who hope they continue to stay relevant in the new world of mortgage originations, but fear their role will be diminished if not rendered obsolete. “The lender is ceding less authority to the closing agent but they are still letting them close the transactions with greater supervision,” said one industry insider. “Could that change? There is a fear it might, but that is not how it is now.” Joseph Ventrone, vice president for regulatory and industry relations at the National Association of Realtors, put...