The CFPB has stepped back into the Real Estate Settlement Procedures Act enforcement ring by probing Zillow over issues related to co-marketing. The probe of the company’s co-marketing initiative was disclosed to the public earlier this month by Zillow CFO Kathleen Philips during the company’s first quarter earnings conference call with investors. “Over the past two years, the CFPB has been reviewing our program for compliance with RESPA,” Philips said. “Recently, the CFPB requested additional information and documents from us as part of their evaluation, which we are working with them on,” she added. “We believe our co-marketing program has, and continues to, allow agents and lenders to comply with the law while using our product.” This could be another ...

Treasury Eyeballing CFPB Rules as Part of Regulatory Relief Review. The Treasury Department is focused on a wide range of regulatory requirements where simple communication and clarification of the regulatory intent is warranted, such as the CFPB’s ability-to-repay rule, the integrated disclosure rule and the Home Mortgage Disclosure Act rule, Craig Phillips, counselor to the Treasury secretary, said during a symposium in New York City last week, according to Inside Mortgage Finance.... Dodd-Frank Changes to be Discussed. House Financial Services Committee Chairman Jeb Hensarling, R-TX, is scheduled to discuss his Dodd-Frank Act alternative, H.R. 10, the Financial CHOICE Act, Tuesday of this week at an event at the American Enterprise Institute....

The latest twist in the Consumer Financial Protection Bureau’s enforcement of the Real Estate Settlement Procedures Act involves certain co-marketing activities. It has recently come to light that the CFPB is investigating Zillow for possible RESPA violations apparently having to do with the firm’s practice of co-marketing with loan officers, real estate agents and mortgage lenders. “For years, many industry participants wondered if allowing their real estate agents or loan officers to engage in co-marketing on Zillow Group applications and websites posed a risk to their companies under RESPA. The industry may soon know the answer,” Richard Andreano, a partner at the Ballard Spahr law firm in Washington, DC, noted in a recent online blog post. Andreano’s post cited...

The Department of Veterans Affairs has issued guidance clarifying its requirements for completing the Interest Rate Reduction Refinance Loan Worksheet. The guidance is effective for all IRRRL applications originated on or after July 2, 2017. The VA said it has received many inquiries from lenders regarding the proper completion of IRRRL Worksheet (VA Form 26-8923) since the implementation of the TRID-LE and CD (Truth in Lending Act-Real Estate Settlement Procedures Act Integrated Loan Estimate and Closing Disclosure.) The guidance clarifies and establishes VA policy regarding the following: Amount of the existing allowable loan balance (Line 1); Principal reduction from veteran (Line 2); Maximum allowable discount points (Line 5); Maximum allowable closing costs (Line 8); Maximum allowable closing costs (Line 11); and Maximum loan amount (Line 18). VA said it understands the ...

Mortgage industry officials are gearing up to weigh in once again on the mortgage servicing rules the Consumer Financial Protection Bureau issued back in 2013. Last week, the CFPB released its proposed plan to assess the rules as required by the Dodd-Frank Act. The bureau plans to evaluate how adequately its rule has met four key purposes: responding to borrower requests and complaints in a timely manner; maintaining and providing accurate information; helping borrowers avoid unwarranted or unnecessary costs and fees; and facilitating review for foreclosure avoidance options. The bureau plans...

The CFPB last week released its plan to assess the effectiveness of its mortgage servicing rule under the Real Estate Settlement Procedures Act and is requesting public input. The bureau issued its mortgage servicing rules under RESPA and Regulation X back in January 2013, and amended the final rule on several occasions before it took effect Jan. 10, 2014. The final rule addressed six major topics: force-placed insurance; error resolution and information requests; general servicing policies, procedures and requirements; early intervention with delinquent borrowers; continuity of contact with delinquent borrowers; and loss mitigation procedures. With its assessment plan, the bureau intends to focus on how well its rule has met four key purposes: responding to borrower requests and complaints in ...

The CFPB was not alone in its crackdown last week on Ocwen Financial over its alleged mortgage servicing failures and violations. The same day the bureau announced its action, Florida Attorney General Pam Bondi and Office of Financial Regulation Commissioner Drew Breakspear filed a federal civil consumer protection lawsuit against Ocwen and subsidiaries, Ocwen Loan Servicing, LLC, and Ocwen Mortgage Servicing, Inc., for what they called “mortgage servicing misconduct.” According to the complaint, Ocwen harmed citizens of the Sunshine State by filing illegal foreclosures, mishandling loan modifications, misapplying mortgage payments, failing to pay insurance premiums from escrow and collecting excessive fees. Ocwen services roughly 125,000 home mortgages in the state. The complaint, filed in federal court in West Palm Beach, ...

The Trump administration’s Department of Justice has convinced the U.S. Court of Appeals for the District of Columbia Circuit to grant it 10 minutes to present its unusual case when oral arguments are heard in the upcoming en banc proceedings in PHH Corp. v. CFPB. “Upon consideration of the unopposed motion of the United States for leave to participate in oral argument, it is ordered that the motion be granted,” the appeals court said in its one-page order. PHH Corp. et al., as petitioners will have 30 minutes to make their case, as will the CFPB as respondent. “The United States agrees with petitioner PHH Corp. that the for-cause removal provision is unconstitutional, but agrees with the CFPB that the ...

Research by two economists in the CFPB’s Office of Research found that many homebuyers do not shop around for a mortgage, and that costs them a pretty penny. “Close to half of consumers did not shop before taking out a mortgage,” CFPB economists Alexei Alexandrov and Sergei Koulayev said in a new white paper. They cited the National Survey of Mortgage Originations, a representative survey conducted jointly by the bureau and the Federal Housing Finance Agency, which found that almost half of consumers “seriously considered” only one lender before making a choice. Also, “Barely any consumers considered more than three lenders,” the economists added. “Worse, many consumers do not seem to realize that there is price dispersion.” In other words, ...

Well, the good news for the mortgage industry is that someone finally got around to talking about the Real Estate Settlement Procedures Act when it came time to file another brief in PHH Corp. v. CFPB. But the bad news: It was the CFPB, and it doubled down on the main arguments it made the first time around, reaffirming its controversial interpretation. The CFPB insisted Director Richard Cordray correctly interpreted the act. First, the agency said PHH’s “kickback scheme” violated RESPA. The interpretation of RESPA by the three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit was incorrect, said the CFPB. “Its crucial error was holding that the meaning of section 8(c)(2) of RESPA – in ...