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 ...

The Consumer Financial Protection Bureau last year logged 988 servicemember complaints related to the origination and servicing of VA and FHA mortgages. CFPB data showed VA outscored FHA on the number of complaints, 740 to 248, respectively, in 2017. The top five reasons for servicemember complaints were trouble during the payment process, difficulty in paying the mortgage, loan servicing, applying for a purchase mortgage or refinance, and closing a loan. Other complaints were about loan modification and foreclosure, mortgage brokers, incorrect information, settlement process and costs, underwriting/credit decision, credit-reporting company’s investigation of a consumer problem, and improper use of a credit report. Abusive practices related to loan churning might not be reflected clearly in servicemembers’ complaints in 2017 compared to the previous year, but a deeper dive into the ... [Chart]

The CFPB is Still Open, Government Shutdown and Mick Mulvaney Notwithstanding. Much of the federal government in Washington, DC, is back in shutdown mode, after last-minute budgetary brinkmanship on Capitol Hill failed to keep the requisite funds flowing. ... Cordray to Face Kucinich in Contest for Democrat Nomination for Ohio Governor. Former Rep. Dennis Kucinich, D-OH, recently filed paperwork with the Ohio Secretary of State’s office officially declaring his candidacy for the Democrat nomination for governor, an indication that former CFPB Director Richard Cordray will face plenty of opposition for the position....

As 2017 came to an end, the CFPB and other federal prudential regulators informed the industry they would implement a “good faith efforts” enforcement philosophy toward lender compliance with the new requirements under the Home Mortgage Disclosure Act that took effect Jan. 1. The CFPB in 2015 put out its rule under which financial institutions were required to collect and report new mortgage data points for loans made after Jan. 1, 2018. This past August, the bureau released a final rule that clarified some reporting requirements, increased the threshold for collecting and reporting data on home equity lines of credit for two years, and made various technical corrections. “The bureau recognizes the significant systems and operational challenges needed to meet ...

In conjunction with the interagency regulatory pledge to pursue a “good faith efforts” approach to the enforcement of new reporting requirements under the Home Mortgage Disclosure Act, the CFPB also announced it plans to initiate a rulemaking to reconsider various aspects of the 2015 HMDA rule – most notably on issues such as the institutional and transactional coverage tests and the rule’s discretionary data points. “More specifically, the rulemaking may re-examine lending-activity criteria that determine whether institutions are required to report mortgage data,” it said. Other revisions might be made to the new requirements to report certain types of transactions. The bureau also is likely to re-assess the additional information that its HMDA rule requires beyond the new data points specified ...

Banks are increasingly worried about staying compliant with all the recent regulations they’re contending with – and the new Home Mortgage Disclosure Act requirements are still one of the biggest concerns. A new regulatory and risk management survey from Wolters Kluwer based on 2017 data registered a 3 percent increase over 2016. “The ability to maintain compliance in an environment of heightened regulatory oversight – highlighted by a spike in the number of major new regulations – remained the biggest overall compliance concern, as cited by 67 percent of respondents,” the report stated. Concerns over fair lending regulatory examinations increased by 5 percent to 46 percent, and concerns jumped 13 percent in measuring the ability to manage risk across all lines of business ...

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 ...

During the recent annual meeting of the Mortgage Bankers Association, a top compliance expert highlighted some of the biggest issues and concerns the industry faces under the new data collection and reporting regime ushered in by the CFPB’s updated Home Mortgage Disclosure Act rule. The short list of the most significant considerations, of course, includes the fair lending implications of the new requirements. Mitch Kider, chairman and managing partner of the Weiner Brodsky Kider PC law firm in Washington, DC, told attendees at one break-out session that HMDA data accuracy (or errors) sets the tone for an entire CFPB examination. “Most of the new data fields companies already have,” he said. “Do you know what story your data currently tells ...

The CFPB recently issued some proposed policy guidance for its Home Mortgage Disclosure Act rule that could help borrowers on the data privacy front, but it might not be enough, according to one compliance attorney. “On the heels of the Equifax data breach and continued cybersecurity threats, the CFPB’s guidance is a clear attempt to alleviate concerns regarding identity theft and information security,” Alexander Koskey, an associate in the Atlanta office of the Baker Donelson law firm, said in a recent client note. “However, significant privacy concerns persist that the increase in the amount of data that is being disclosed for the first time will make it easier to discover the identity of applicants and borrowers.”Additionally, given that the ...

African-American and Hispanic Borrowers Allegedly Harmed by Provident Will Receive $9 Million in Compensation. Last week, Garden City Group, the settlement administrator for Provident Funding Associates, mailed out checks to African-American and Hispanic borrowers to compensate them for having been unlawfully charged higher interest or broker fees on their mortgages from Provident.... Ocwen Enters Into Agreement with Hawaii to Resolve Regulatory Action. Ocwen Financial settled some outstanding issues with regulatory authorities in Hawaii last week, continuing a streak the nonbank servicer has been on for the last two months or so....