Some top industry players support the CFPB’s proposed amendment to its existing TRID rule that clarifies a lender’s ability to use a revised closing disclosure (CD) to reset tolerance baselines for fees and charges, as long as there are valid changes of circumstances. However, they think a few simple tweaks could maximize the usefulness of the change without creating an incentive for lenders to act in such a way as to defeat the bureau’s intention. The proposal clarifies that the authority to “rebaseline” exists for all CDs – not just the initial CD – and that for any CD issued after the first one, there is no timing requirement, and no timing limitation on the issuance of the initial CD. That means ...

Securitization Group Meets with CFPB Officials. Earlier this month, staff and members of the Structured Finance Industry Group met with CFPB Director Richard Cordray and other senior officials to talk about the state of the non-agency mortgage securities market and some of the factors hampering its return.... Mortgage Lenders Meet With Bureau, Other Regulators, to Discuss Diversity, Inclusion. A small group of mortgage lenders recently met with staff of the CFPB, the Federal Reserve, the Federal Deposit Insurance Corp., the Federal Housing Finance Agency and the Office of the Comptroller of the Currency to discuss best practices on how to develop and maintain diversity and inclusion programs within the mortgage industry, according to an account by the Mortgage Bankers Association....

Freddie Mac is set to issue a $459.92 million Whole Loan Securities transaction, according to a presale report from Moody’s Investors Service. The firm didn’t rate the senior tranche of the deal but did place a Baa1 rating on a mezzanine tranche of Freddie Mac Whole Loan Securities 2016-SC02. The government-sponsored enterprise priced the latest WLS transaction this week, with the deal expected to close next week. “We are pleased with the pricing levels and depth of investor participation in the WLS program,” said Kevin Palmer, senior vice president of credit risk transfer at Freddie. “We look forward to continued issuance in 2017.” Freddie has issued...

The Consumer Financial Protection Bureau’s recent actions against an unspecified number of lenders that offer non-qualified mortgages prompted some criticism about how the regulator enforces standards in the ability-to-repay rule. The CFPB cited lenders for originating non-QMs that allowed “alternative income documentation” for salaried borrowers. The CFPB said the products offered by the lenders relied primarily on the assets of each borrower when making an ATR determination ...

The FY 2016 Actuarial Review showed a stronger FHA mortgage insurance fund, thanks to a surging forward loan portfolio, but the prospect of a price adjustment remains unlikely. Review results were a mixture of good news and bad news. The good news is the Mutual Mortgage Insurance Fund’s economic net worth grew by $3.8 billion to $27.6 billion – $4.2 billion short of what last year’s actuarial report projected. The capital ratio rose to 2.32 percent, exceeding the 2.0 percent minimum established by Congress to cover future losses. Observers said the increases demonstrate steady but modest growth in the fund. The Department of Housing and Urban Development’s top officials credited the fund’s growth to a stronger forward-mortgage portfolio, which increased by $18 billion to $35.3 billion – $10.1 billion above projections – with a capital ratio of 3.28 percent. The report attributed the increase to a ...

The Department of Justice lost its bid to have an FHA lawsuit against Quicken Loans heard in the nation’s capital after a federal judge this week ordered the case transferred to federal district court in Michigan. Judge Reggie Walton of the U.S. District Court for the District of Columbia agreed with Quicken that the proper forum for adjudicating the government’s False Claims Act case is the Eastern District Court in downtown Detroit. While the court agreed that the case has national implications, it also noted the “strong local interest in this matter in the Eastern District of Michigan,” where “Quicken Loans underwrote the FHA loans at issue, endorsed those loans, and certified its compliance as to those loans.” While certain factors weighed against the transfer, the alleged unlawful activity occurred in or near Detroit, where the lender is headquartered and most of its employees are located. The case, U.S. v. Quicken Loans, ...

Industry Groups Urge Congressional Leaders to Pass ‘Tax Extenders’ Legislation. Three industry groups called upon House and Senate leaders to pass “tax extenders” legislation, including two critical tax provisions that are scheduled to expire at the end of 2016. In a joint letter this week, the Mortgage Bankers Association, National Association of Realtors and the National Association of Home Builders called for the “rapid enactment” of a broad “tax extenders” package, including mortgage-debt forgiveness and tax deduction for mortgage insurance premiums. Passing a legislative package of tax extenders that includes the two provisions would provide much-needed certainty to the residential real estate markets, the letter said. Federal Agencies Propose Rule to Expand Access to Private Flood Insurance. Federal banking and credit union regulators and the Farm Credit Administration have published a ...

Last week’s surprise presidential victory by Republican billionaire real estate developer Donald Trump means some big changes for rulemaking and enforcement activities at the CFPB, to the benefit of the financial services industry, according to the consensus of a variety of analysts and experts. The most likely changes have to do with replacing the bureau’s single director leadership structure a bipartisan commission, and subjecting the agency to the congressional appropriations process. But the tenure of the current director, Richard Cordray, also could come into play, some feel. FBR & Co. analyst Edward Mills and his team predict the agency will have a new director “following the D.C. Circuit Court of Appeals ruling [involving PHH Corp.] that allows the president to ...

The Community Home Lenders Association told the CFPB that the existence of the bureau as a dual regulator along with state supervision of nonbank lenders is exacerbating the consolidation of such community lenders to the detriment of consumers. “In establishing and implementing mortgage rules, Congress and the CFPB have recognized the value of smaller community lender/servicers and created certain targeted exemptions, such as certain Regulation Z and Regulation X exemptions for smaller servicers,” the CHLA said. The trade organization’s remarks were delivered in a public comment letter submitted to the agency as part of the bureau’s TRID clarifying rulemaking process. The problem is, these exemptions generally are targeted towards community banks and credit unions, and legislation pending in Congress is ...