QM Portfolio Lending Legislation Would Cost CFPB $1 Million to Implement. Enacting H.R. 2226, the Portfolio Lending and Mortgage Access Act, introduced last April by Rep. Andy Barr, R-KY, would cost the CFPB $1 million, according to a new analysis by the Congressional Budget Office. “Using information from the CFPB, CBO estimates that enacting H.R. 2226 would increase direct spending by $1 million in 2019 for the agency to issue rules to implement ... [Includes four briefs]

At $600K a Year, Fannie Mae CEO Tim Mayopoulos is Underpaid. Although Fannie Mae reported pre-tax income of $18.4 billion in 2017, its CEO Timothy Mayopoulos took home, once again, a base salary of roughly $600,000, the limit for both GSE CEOs and a figure that seems exceedingly low when compared to financial services firms of similar size. A new 10-K filing from the company notes: “Our chief executive officer’s compensation in 2017 was more than 90 percent below the market median for comparable firms. Our inability to offer market-based compensation hinders our succession planning for our chief executive officer role, and potentially our ability to hire...

The House of Representatives this week approved bills extending regulatory relief pertaining to the integrated disclosure rule under the Truth in Lending Act and the Real Estate Settlement Procedures Act, or TRID.

The Department of Veterans Affairs will require lenders to provide early disclosures to veterans seeking to refinance into a VA Interest Rate Reduction Refinance Loan. The new policy aims to ensure that the VA streamline refi loan they sought would actually lower their monthly mortgage payments and is not just a scam for lenders to charge higher fees. Loan churning, or serial refinancing, is at the root of the VA policy change. Churning refers to multiple refinancing of an unseasoned mortgage loan within a very short time, often within six months of origination. Serial refinancing may add more payments and interest to the new loan, prolonging debt repayment, and can strip equity. It also potentially raises the risk of default by the borrower. In addition, the risk of prepayment could affect pricing of Ginnie Mae securities, which could cause lenders to charge higher rates on VA loans to make up for the ...

PennyMac Financial will resume originating jumbo mortgages in the correspondent channel this year, the lender announced this week. And jumbos will be offered in the broker channel operations recently launched by PennyMac. The House approved a bill this week that would shrink the potential market for non-qualified mortgages. H.R. 1153, the Mortgage Choice Act, was approved on a 280-131 vote with some bipartisan support. The legislation would ... [Includes two briefs]

The U.S. Court of Appeals for the District of Columbia Circuit last week saved PHH Mortgage and its parent more than $100 million when it sent the lender’s dispute with the Consumer Financial Protection Bureau over issues related to the Real Estate Settlement Procedures Act back to the bureau, basically starting over.

Last week, the en banc panel of the U.S. Court of Appeals for the District of Columbia Circuit issued its long-awaited decision in the tussle between the CFPB and PHH Corp. The ruling addressed two distinct issues in the dispute, the first being the leadership structure of the CFPB, which PHH alleged was unconstitutional. The district court had previously sided with PHH, but the appeals court reversed that component of the ruling, and did so largely on party lines. On the other hand, the appeals court judges transcended party orientation and sided with PHH on the part of the dispute that deals with the Real Estate Settlement Procedures Act. (See following story.) On the question of the constitutionality of the ...

The second part of last week’s ruling by the en banc panel of the U.S. Court of Appeals for the District of Columbia Circuit went in favor of PHH Mortgage in its lengthy legal dispute with the CFPB over issues tied to the Real Estate Settlement Procedures Act. The court upheld the original three-judge panel interpretation of RESPA and its application to PHH in this case, stating that it was improperly applied and that the lender is entitled to the relief granted.More specifically, the en banc court reinstated the Oct. 11, 2016, panel decision related to the RESPA issues, which included vacating the bureau’s order imposing $109 million in disgorgement penalties, and remanded the matter for further proceedings based ...

In response to last week’s ruling by the D.C. Circuit Court of Appeals that confirmed the constitutionality of the CFPB but rejected the bureau’s interpretation of RESPA in its legal dispute with PHH Mortgage, Rep. Jeb Hensarling, R-TX, suggested CFPB Acting Director Mick Mulvaney appeal to the Supreme Court of the United States. “I am deeply disappointed with the court’s decision and hope the Supreme Court will review the ruling in short order,” said Hensarling, chairman of the House Financial Services Committee. “In the meantime, I take great solace in the fact that Mick Mulvaney can use his unchecked, unilateral powers to continue the agency’s transformation into one that will, as he said, ‘exercise [its] statutory authority to enforce the ...

The CFPB last week moved to restructure how the agency enforces fair lending laws, consolidating that function under the director’s office, which is headed by interim appointee Mick Mulvaney. In a statement provided to Inside the CFPB, John Czwartacki, senior advisor to the acting director, said: “The bureau’s statutory mandate includes the supervision and enforcement of fair lending laws and regulations [and] the bureau will continue to perform those functions.” He added: “The fact is, it never made sense to have two separate and duplicative supervision and enforcement functions within the same agency – one for all cases except fair lending, and the other only for fair lending cases. By announcing our intent to combine these efforts under one roof, we ...