The Community Home Lenders Association last week asked CFPB Acting Director Mick Mulvaney to delay implementing the bureau’s pending new data collection and reporting requirements under the Home Mortgage Disclosure Act, which are slated to kick in Jan. 1, 2018. The trade group’s more general concerns are, first, that HMDA requirements should be balanced and tailored to the objectives. “The Trump administration has pledged to address overly burdensome regulations which have a negative impact on the ability of private sector finance providers to make credit available to consumers,” said the CHLA, which represents mostly small, independent mortgage bankers. The industry organization reminded Mulvaney it has issued reports and written letters this year detailing how excessive regulations and the threat of ...

The Senate Banking, Housing and Urban Affairs Committee recently passed a bipartisan measure that will provide some noteworthy relief from a handful of CFPB regulations, especially for small and regional lenders. Under S. 2155, the Economic Growth, Regulatory Relief and Consumer Protection Act, certain mortgages originated and retained in portfolio by banks and credit unions with less than $10 billion in total assets would be deemed qualified mortgages under the bureau’s ability-to-repay rule. The act also would provide regulatory relief under the Home Mortgage Disclosure Act for small depository institutions that have originated less than 500 closed-end mortgage loans or less than 500 open-end lines of credit in each of the two preceding calendar years. The Government Accountability Office would ...

Speaking during a recent public appearance in Washington, DC, Mark Calabria, chief economist in the Executive Office of the Vice President, discussed the Trump administration’s priorities when it comes to regulatory reform, and the CFPB’s ability-to-repay rule was one of the items on the list. “Looking at the mortgage finance system as a whole is critical, as is reviewing the substantive rule-makings that came out of the Dodd-Frank Act,” said Calabria, former director of financial regulation studies at the libertarian Cato Institute in Washington, DC, and a former Capitol Hill staffer involved in drafting the framework for the conservatorships of government-sponsored enterprises Fannie Mae and Freddie Mac. “We really did expand the regulatory framework with things like the qualified mortgage ...

A new report from the Office of the Inspector General of the Federal Deposit Insurance Corp. found that examiners in the agency’s Division of Depositor and Consumer Protection need to do a better and more consistent job of reviewing lenders’ compliance with the CFPB’s ability-to-repay and loan originator compensation rules. The ATR rule directed most mortgage lenders to make a reasonable and good-faith determination, at or before loan consummation, that a consumer would have a reasonable ability to repay a residential mortgage loan according to its terms. Some lenders and loan programs are exempt from this requirement. The LO comp rule placed limits on loan originator compensation and imposed new requirements on loan originators. Both rules took effect Jan. 10, 2014....

The three most notable aspects of Janet Yellen’s final press conference as the chair of the Federal Re-serve were the expected comments in support of the central bank’s 25 basis point rate increase, positive economic expectations of pending tax reform efforts, and confirmation the Fed is unlikely to provide much information about its balance sheet reduction going forward.

Mortgages with high home price-to-income ratios tend to perform worse than mortgages with lower PTI ratios, according to economists at the Federal Reserve. The analysts suggest that PTI ratios are a helpful tool for gauging mortgage risk by tracking housing affordability. “Banks that have greater exposure of mortgages to high PTI regions have higher mortgage delinquency and charge-off rates and significantly higher probabilities of failure, even after controlling for ...

A recent report from the JPMorgan Chase Institute found that payment reduction was the most effective form of post-crisis loan modification, and a 10 percent drop in the mortgage payment lowered default rates by 22 percent.

Overshadowed by all the drama associated with the resignation of CFPB Director Richard Cordray and the struggle over who is to serve as his temporary replacement was some potentially significant legislative activity on Capitol Hill. A number of bills were recently introduced or are in the process of facing votes that could affect the CFPB, some of its rulemakings and the regulations it enforces. Rep. Sean Duffy, R-WI, chairman of the House Financial Services Subcommittee on Housing and Insurance, and Sen. Mike Enzi, R-WY, chairman of the Senate Budget Committee, late last week introduced bicameral legislation to restrain the CFPB’s rates of pay. Specifically, the legislation, H.R.4499, the CFPB Pay Fairness Act, would require the director of the bureau to ...

The mortgage industry continues to have serious consumer privacy and data concerns with the CFPB’s Home Mortgage Disclosure Act proposed guidance. But with new leadership in place, the bureau has a great chance to deal with the issues in a more appropriate manner, according to the Housing Policy Council of the Financial Services Roundtable. With new Acting Director Mick Mulvaney in place, the bureau could change course, electing to satisfy the statutory obligation to follow a formal rule-making process and also reconsidering the CFPB’s position regarding the disclosure of loan-level data, according to Ed DeMarco, president of FSR’s HPC. “Securing sensitive consumer data is a top priority for the financial industry,” said DeMarco, the former chief of the Federal Housing ...

As the end of the year nears, there’s been talk this week about negotiations underway between the Federal Housing Finance Agency and the Trump administration to address the capital situation at Fannie Mae and Freddie Mac. Although no one is confirming the discussion, a Bloomberg report quoted an anonymous source as saying that FHFA officials want Fannie and Freddie each to keep a capital buffer of $2 billion to $3 billion on their books. In return, the report said, the administration wants to limit the GSEs’ activity in the market by tightening restrictions on the type of loans they buy. In late 2013, former FHFA Acting Director Ed DeMarco proposed implementing a loan size limit on...