Fitch Ratings was the most active rating service in the sluggish non-agency MBS market through the first half of 2016, according to a new Inside MBS & ABS ranking. Standard & Poor’s was the top rating agency in the more active non-mortgage ABS market. Fitch rated just seven non-agency MBS issued during the first six months of the year, which totaled $4.74 billion in volume. While that equaled 30.9 percent of total non-agency MBS issuance for the period, many deals were private placements without ratings. Fitch’s share of rated issuance was 55.4 percent. DBRS ranked...[Includes two data tables]

First it was Corinthian Colleges, then ITT Educational Services. Now, Bridgepoint Education Inc. has been taken to task by the CFPB over alleged misconduct. Last week, the bureau brought a $31.5 million enforcement action against the for-profit post-secondary education company based in San Diego, accusing it of deceiving students into taking out private student loans that cost more than advertised....

Bank and thrift holdings of non-agency ABS fell slightly during the second quarter, but the industry is not backing away from the consumer credit space. Depositories prefer to hold these assets in unsecuritized form on their balance sheets. A new Inside MBS & ABS analysis of call-report data shows that banks and thrifts held $130.98 billion of non-mortgage ABS at the end of June. That was down 0.7 percent from March and represented the 10th consecutive quarterly decline since the end of 2013, when the industry’s ABS holdings hit their all-time peak. According to the Securities Industry and Financial Markets Association, the supply of non-mortgage ABS debt outstanding actually rose...[Includes two data tables]

The CFPB recently brought a $4 million enforcement action against Wells Fargo, alleging the bank engaged in illegal private student loan servicing practices that increased costs and unfairly penalized certain student loan borrowers. “Wells Fargo hit borrowers with illegal fees and deprived others of critical information needed to effectively manage their student loan accounts,” said CFPB Director Richard Cordray. The bureau said it identified breakdowns throughout Wells Fargo’s servicing process, such as failing to provide important payment information to consumers, charging consumers illegal fees, and failing to update inaccurate credit report information. One of the CFPB’s charges against the company was that it processed payments in a way that maximized fees for many consumers. “Specifically, if a borrower made a ...

The Federal Communications Commission has issued a baffling final rule restricting the way servicers can collect on or service student loans, mortgages and other debts owed to the federal government.Specifically, the rule implements a key provision in the Bipartisan Budget Act of 2015 amending the Telephone Consumer Protection Act to exclude robocalls from the TCPA consent requirement if they are made solely to collect a debt owed to or guaranteed by the federal government.The TCPA generally requires a caller to obtain “prior express consent” from the call recipient before making a telemarketing call or an auto-dial call to the recipient’s landline or cell phone.However, the mortgage industry raised concerns that TCPA’s consent requirement could create potential liability for important servicing calls that could help homeowners save their homes, which prompted Congress to pass the Budget Act amendment. Last month, the FCC specifically excluded the federal government from the TCPA’s consumer protections by ruling that the government is not a “person” subject to the TCPA. Here is where the FCC rule gets confusing. commission is authorized to adopt rules to “restrict or limit the number and duration” of any wireless calls to collect debt owed to the federal government.”

Student loan borrowers are encountering difficulties when they try to file an application for income-driven repayment (IDR) plans, according to the CFPB’s midyear update on student loan complaints, which was released late last week. Since 2009, the vast majority of borrowers with federal student loans have a right under federal law to set their monthly student loan payments based on their income. For borrowers who are unemployed or earn low wages, these IDR plans provide for a “payment” as low as $0 per month.“Many borrowers depend on student loan servicers to inform them about the availability of IDR options and for processing borrowers’ enrollment in these plans,” said the bureau. “This report observes that borrowers encounter obstacles when submitting ...

New issuance of non-mortgage ABS faltered in the second quarter of 2016, but the market has rebounded strongly in recent weeks, according to a new Inside MBS & ABS analysis. New ABS issuance totaled $43.07 billion in the second quarter, a modest decline from the first three months of 2016. That put year-to-date production at just $86.42 billion, off 18.0 percent from the first six months of 2015. Activity picked up...[Includes two data tables]

The CFPB’s TILA/RESPA Integrated Disclosure Rule – dubbed TRID – may have been causing mortgage lenders severe heartburn since it took effect in early October, but you wouldn’t know it by looking at consumer complaints about the mortgage application and origination process. They fell by 9.3 percent during the second quarter, according to a new analysis and ranking by Inside the CFPB – part of a larger drop off that found gripes down by 16.5 percent for the period, and off 4.5 percent year over year. The number of complaints that lenders responded to in a timely manner dropped 16.1 percent quarter over quarter, and 4.3 percent year over year. However, that could be because perhaps lenders/servicers were making more of an effort [With two exclusive charts]...

Standard & Poor’s lost a little market share in the business of rating non-mortgage ABS during the first quarter of 2016, but the firm still was the most active player in the market, according to a new ranking by Inside MBS & ABS. S&P rated 58.4 percent of the $41.42 billion of non-mortgage ABS issued in early 2016, down from its 61.5 percent share for all of last year and its 64.1 percent share back in 2014. The company’s strong suit was in vehicle-finance ABS, where it rated 64.7 percent of the market, by dollar volume. While S&P’s share was up slightly in a few categories, its stake in the credit card ABS segment fell...[Includes two data tables]

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 ...