More Gripes About TRID Dribble In. After what seemed like a lull in hearing complaints from lenders regarding the integrated disclosure rule known as TRID, the gripes are picking up again. At least that’s what we detected from some originators a few days ago. One loan broker who works the southern California market said she’s been telling some clients that it will take an extra seven days to close. “It was 15 before wholesale caught up, but now they’re behind again due to heavy sales volume.” Broker Slams Bureau’s Complaint Database. While he was running for a House seat in West Virginia, mortgage trade group president Marc Savitt was mostly quiet on issues tied to the CFPB. But now that ...
The Consumer Financial Protection Bureau’s proposed rule that aims to effectively end the use of arbitration clauses in U.S financial product contracts will create new risks for ABS tied to consumer loans as well as related financial services companies, according to Moody’s Investors Service. “The fact that the proposed rule would not affect contracts outstanding before it is finalized would lessen its effects initially, as well as over the longer term for contracts on products that typically have long lives, such as credit cards,” analysts from Moody’s said. “Nevertheless, if adopted, the rule would expand legal risks for banks and other financial companies, and could adversely affect some securitizations.” That being said, “Some of the negative effects, however, would be offset...
Earlier this month, the CFPB finally issued its long-awaited proposed rule to drastically scale back the ability of consumer financial companies to use pre-dispute arbitration clauses in their contracts for consumer financial products and services. The proposed rule would impose two sets of limitations on the use of pre-dispute arbitration agreements by covered providers of consumer financial products and services. First, it would prohibit providers from using such an agreement to block consumer class actions in court and would require providers to insert language into their arbitration agreements reflecting this limitation. “This proposal is based on the bureau’s preliminary findings – which are consistent with [its earlier] study – that pre-dispute arbitration agreements are being widely used to prevent consumers from seeking ...
Banks generally eased their lending standards for most types of residential mortgage loans in the first quarter of 2016, even as consumer demand for such credit increased, according to the Federal Reserve’s latest senior loan officer opinion survey. During the period ending March 31, a “moderate net fraction” of banks reported having eased standards on mortgages eligible for purchase by the government-sponsored enterprises, Fannie Mae and Freddie Mac, while a similar number of institutions indicated they had eased standards on “qualified mortgage” and non-QM jumbo mortgages, as well as on QM non-jumbo, non-GSE-eligible and on non-QM, non-jumbo residential mortgage loans. At the same time, banks left...
Thanks to a resurgence of deals backed by vehicle-related financing, non-mortgage ABS production rebounded strongly in the first three months of 2016, according to a new Inside MBS & ABS analysis and ranking. But ABS issuance levels came up well short of the volume generated during the first three months of last year, and a few key segments continued to limp along. A total of $41.42 billion of non-mortgage ABS were issued...[Includes two data tables]
Borrowers saddled with student loan debt now have a better chance of qualifying for an FHA mortgage, thanks to a recent change in the way lenders factor such payments in the calculation of a borrower’s debt-to-income ratio. Under newly revised guidance announced by the FHA recently, lenders may apply the same calculation criteria used in the mortgage industry regardless of the type of student loan-payment plan (such as income-based payment plans) or a deferred-payment plan. Currently, there are...
Overall net losses in subprime auto ABS are on the rise due to an increasing number of deals from smaller lenders that cater to borrowers with weak credit. Amid this trend, however, subprime auto ABS performance varies by lender, according to a new report from Moody’s Investors Service. Moody’s analysts said competition among auto lenders has tightened as new, mostly smaller, lenders – driven by low losses on post-crisis auto loans and low interest rates – enter the market and compete for borrowers. The crowded market has driven...
Overall consumer complaints to the CFPB reached their lowest level in at least a year and a half, according to a new analysis and ranking by Inside the CFPB. Total gripes to the bureau slid 5.0 percent in the first quarter and were off 3.0 percent on an annual basis, data from the CFPB consumer complaint database show. Kvetching about residential mortgages was down slightly more, falling 6.7 percent and 4.1 percent, respectively, for those two time periods. In fact, mortgage-related belly-aching hasn’t been this low since the fourth quarter of 2013. The most dramatic change was seen in the prepaid card space, where criticisms plunged 73.3 percent in 1Q16. ... [with exclusive data chart] ...
U.S. Military Personnel Continue to Report Problems With Their Mortgages. Complaints to the CFPB from American military personnel about their mortgages rose 10 percent from 2014 to 2015, according to a recent report from the bureau. The good news for mortgage lenders is that total complaints about their operations – roughly 9,900 – were less than half of the total generated by debt collection practices, which came to about 20,500. ... FHFA Wants Public Input on National Mortgage Borrower Survey. The Federal Housing Finance Agency is seeking public comments about the American Survey of Mortgage Borrowers, an information collection effort otherwise known as the National Survey of Existing Mortgage Borrowers. ...
Standard & Poor’s kept its position as the top provider of ratings for newly issued non-mortgage ABS last year, although the volume of deals the company rated fell 10.1 percent from 2014, according to a new Inside MBS & ABS analysis. S&P rated ABS bonds totaling $106.86 billion in new issuance in 2015, or 61.5 percent of deals for which rating information was available. That was down slightly from its league-leading 64.1 percent share of the rated 2014 ABS market. The company’s strong suits were credit card ABS and deals backed by vehicle loans and leases. Fitch Ratings finished...[Includes two data tables]