Some residential mortgage-backed securities loan originators are moving away from performing internal post-acquisition quality control loan reviews in lieu of obtaining feedback from their whole loan investors, according to a new report from Moody’s Investors Service. “Some aggregators are relying more on their investors for quality control feedback,” said Moody’s. The ratings service identified in particular Redwood Residential Acquisition Corp. and JPMorgan Mortgage Acquisition Corp., which it said “are relying more on feedback from whole loan investors to monitor the quality of due diligence firm loan reviews, as opposed to conducting their own internal reviews, since a large portion of their acquisitions are sold in whole-loan trades.” Moody’s noted...
Industry trade groups have yet to weigh in on the CFPB’s TRID clarifying rulemaking, but the grassroots rank-and-file have, and many of them are raising more concerns and questions. For instance, Ross Miller, president of Miller Home Mortgage in Metairie, LA, complained that there are no exceptions for the three-day waiting period when there is an emergency. “I had a client whose father was quickly scheduled for open heart surgery,” he said in a comment letter. “The client was ...
The CFPB’s Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure (TRID) rule has been blamed for a lot, including, most recently, producing more defects in mortgage loans. According to a new industry trends report from ACES Risk Management Corp. (ARMCO), a provider of web-based audit technology solutions for the mortgage industry based in Pompano Beach, FL, the industry experienced “a significant decrease in defects” through the second quarter of 2015. However, ...
It’s been almost a year now since the CFPB’s integrated disclosure rule went into effect, and industry participants across the credit spectrum appear increasingly comfortable with the new disclosure regime. But when it first came out, the rule took all the oxygen from the room and caused more fear and anxiety that, in retrospect, appears to be have been justified, according to a handful of experts in the non-prime mortgage origination space. Speaking during ...
H.R. 5983, the Financial CHOICE (Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs) Act by Rep. Jeb Hensarling, R-TX, chairman of the House Financial Services Committee, has incorporated the provisions of a number of bills that have either already passed the committee or the full House of Representatives and that would affect ...
Regulations and practices in the mortgage market will help protect investors in MBS backed by residential mortgages from marketplace lenders, according to Moody’s Investors Service. However, it’s not clear if the protections will be enough to offset the rating penalties often applied to originators and assets that lack historical performance records. Moody’s published its analysis last week, noting that while no residential MBS has been issued by a marketplace lender as yet, the firm expects issuance at some point. Marketplace lenders – the most prominent of which is Social Finance – connect...
The House Financial Services Committee this week marked up, mostly on party lines, a comprehensive alternative to the Dodd-Frank Act that would, among other things, create a legal safe harbor for mortgage loans that are originated by a lender and then held in portfolio on its balance sheet. Democrats unanimously opposed the bill and refused to offer a single amendment, continually railing against Wells Fargo and accusing the Republicans of wanting to take the nation “back to the regulatory Stone Age.” The bill passed...
Hundreds of industry participants have written to the Consumer Financial Protection Bureau to express their opposition to or support of the bureau’s attempt to resolve some of the ambiguity associated with its Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure Rule. Title insurers say the CFPB missed a chance to fix a major problem: confusion about title premium charges. Real estate agents say the bureau is making things better for consumers by allowing lenders to share disclosures. One title insurance professional noted...
Hundreds of title agents across the U.S. responded in an organized letter-writing campaign and flooded the CFPB’s inbox with negative comments about the bureau’s attempt to clarify a number of issues related to its controversial TILA/RESPA Integrated Disclosure Rule, otherwise known as TRID.One title insurance professional commented that the CFPB missed an opportunity to change the closing disclosure’s calculation of title fees. “Consumers around the country continue to receive inaccurate information at the closing table about their title insurance costs,” she said. “This provision of the rule defeats the bureau’s own mission to provide consumers with a better understanding of their transaction.” The title agent urged the CFPB to fix this problem immediately so consumers will have a clear ...
Scores of real estate professionals have written to the CFPB to express their support of the TRID 2.0 provision that would enable the sharing of mortgage origination documents between lenders and real estate professionals. Carol Barkstrom, principal broker/owner at Connections Realty in Richmond, VA, told the CFPB, “Thank God you are proposing to make this change. We as agents being denied access to closing documents has been a huge problem.” Previously, real estate professionals “have always had access to disclosure documents to catch possible mistakes and omissions and to explain the meaning of all the pieces and parts of the closing documents to our selling and buying clients,” she added. However, with the original TRID rule, the bureau’s attempt to ...