Most mortgage loans made in recent years meet several of the major requirements to be classified as “qualified mortgages,” but debt-to-income tests could be problematic, according to a new Government Accountability Office report released this week. Loans that meet nine provisions specified in the Dodd-Frank Act would be classified as qualified mortgages and provide the lender some legal protection that the new law’s ability-to-repay standard has been met. The Federal Reserve has proposed a regulation to implement the DFA requirements but left some key issues – such as ... [includes one data chart]

The Office of the Comptroller of the Currency made significant changes to a controversial proposed regulation it issued back in May to implement revised federal preemption standards regarding state mortgage and other consumer protection laws. The OCC’s proposed rule to conform to Dodd-Frank Act preemption provisions was met with significant opposition from state regulators, consumer advocates, members of Congress and even the Department of Treasury, within which the agency functions as an independent bureau. One of the key disputes focused on the OCC’s proposal to use a ...

Without clear, early implementation guidance from the Department of Housing and Urban Development, FHA mortgage lenders could start underwriting to the lower loan limits before the Oct. 1 effective date, limiting the origination of FHA loans, warned two real estate industry groups. Providing guidance to mortgage lenders on how to manage the transition from the current top-end amount of $729,750 to $625,500 for high-cost areas without disrupting FHA lending is critical, the Mortgage Bankers Association and the National Association of Home Builders wrote to HUD. Lenders manage their pipelines based on ...

To bolster some much-needed credibility and quality assurance for consumers seeking appraisals, the Federal Housing Finance Agency and the Consumer Financial Protection Bureau should set minimum standards for states to apply in registering appraisal management companies, a recent Government Accountability Office report said. “Partly in reaction to appraiser independence requirements, lenders have increasingly relied upon AMCs to perform certain functions,” the GAO observed. “Despite the increased use of AMCs, direct federal oversight of AMCs is limited because ...

Consumer Financial Protection Bureau Associate Director Raj Date told lawmakers earlier this month that mortgage servicing will be one of the CFPB’s priorities as soon as it’s open for business. In particular, Date told lawmakers at a joint hearing of the House Financial Services Subcommittee on Oversight and Investigations and the Subcommittee on Financial Institutions and Consumer Credit that the agency will begin addressing two structural problems in the mortgage servicing market, one of which is that the vast majority of borrowers do not get to choose their mortgage servicer...

The controversial Consumer Financial Protection Bureau plans to hit the ground running with bank supervision and examination when its doors officially open for business on July 21, even though there will be no Senate-confirmed director in place as of kick-off. “The new consumer agency is here to make sure that markets work for American families, and our bank supervision program is a big part of that,” said Elizabeth Warren, special advisor to the secretary of the Treasury on the CFPB. “Starting on July 21, we will be a cop on the beat – examining banks and protecting consumers.”...

Lawmakers and regulators seem increasingly cognizant of the potential their actions to improve mortgage servicing may have to exacerbate the difficult environment servicers are confronting in terms of helping struggling homeowners, unclogging the backlog of housing inventory and complying with all necessary laws and regulations in the process. Industry representatives hope that awareness will keep policymakers from going overboard, but they remain anxious while multiple sets of potentially inconsistent and conflicting servicing standards are in play...

Mortgage servicers that have not yet contemplated adjusting their practices to conform to the principles illustrated in the consent decrees federal regulators issued earlier this year against 14 top servicers, as well as the June 30 guidance from the Office of the Comptroller of the Currency, better think again, and quickly, a leading industry attorney is recommending. “I think the OCC’s guidance is a clear statement of regulator expectations as to the performance of bank servicers, both in terms of looking back and addressing past issues and in creating an appropriate compliance structure going forward,” Andrew Sandler, chairman of the BuckleySandler law firm, told Inside Regulatory Strategies. “The expectation should be that other regulators, including the Federal Reserve and the Consumer Financial Protection Bureau, will have very similar sets of expectations.”..

The Department of Housing and Urban Development announced settlements last week with two mortgage lending-related entities over alleged violations of the Real Estate Settlement Procedures Act having to do with affiliates and fees. In one case, HUD alleged that title company Fidelity National Financial Inc., through its subsidiaries, paid fees for the referral of settlement service business in violation of Section 8 of RESPA...

Nevada. Assembly Bill 77 was recently signed into law, revising a number of provisions governing mortgage lending and the conduct and supervision of related professionals (escrow agents and agencies, mortgage bankers, brokers and agents, etc.), and providers of certain covered services... North Carolina. House Bill 312 was approved, amending the methods for recording a satisfaction of a security instrument with the register of deeds. It also clarifies the requirements for electronically registering plats with the register of deeds, and amends restrictions on access to military discharge documents recorded with the register of deeds. The majority of the bill becomes effective Oct. 1, 2011...