Ocwen Financial, stung by legal actions brought simultaneously last week by the CFPB and scores of state regulators, responded by issuing a detailed statement disputing the allegations made by state regulators and defending its business practices. “As with the recent CFPB enforcement action, Ocwen strongly disputes the key allegations made in the state regulators’ cease-and-desist orders that Ocwen’s mortgage loan servicing practices have caused substantial consumer harm,” the company said. “Ocwen will not sign unfair and unjust consent orders that make impractical demands that no other market participant could rationally accept, and which would harm consumers,” it added. “Under these circumstances, Ocwen has a responsibility to its customers, shareholders and employees to vigorously defend the company against unfounded claims while ...

The Conference of State Bank Supervisors urged the leadership of the Senate Banking, Housing and Urban Affairs Committee to enact legislation that would grant qualified-mortgage status under the CFPB’s ability-to-repay rule for loans held in portfolio, as part of a broader set of proposals to stimulate economic growth. The CSBS was one of a number of groups that responded to an invitation by the banking committee to provide ideas for stimulating economic activity. “State regulators have long supported a flexible approach to underwriting for institutions that retain mortgages in portfolio because interests are inherently aligned between consumers and lenders that retain 100 percent of the risk of default,” said the CSBS. “One solution that would tailor the requirement to the ...

With the potential for restrictions placed on Ocwen Financial to be removed in the near future, officials at the nonbank stress that Ocwen has transformed compared with when the restrictions were applied. Near the end of 2014, Ocwen agreed to a $150.0 million settlement with the New York Department of Financial Services. Among other provisions, the settlement required Ocwen to meet certain benchmarks and receive approval from the state regulator before acquiring ...

New York State Aligns State Law With TRID. New York Gov. Andrew Cuomo, D, recently signed into law Senate Bill S982, legislation that tweaks the existing state legal definition of the “consummation” of a mortgage loan to synchronize with the Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure Rule promulgated by the CFPB.... Industry Need to Get TRID-Compliant Boosts DocMagic’s Bottom Line. Industry vendor DocMagic, based in Torrance, CA, late last week reported a 42 percent increase in revenue for 2016, due in large part to industry demand for products that enable compliance with the CFPB’s Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure Rule, otherwise known as TRID....

A Georgia appellate court recently handed Wells Fargo Bank a provisional win in a lawsuit in which a VA borrower alleged breach of contract and wrongful foreclosure. In Wells Fargo Bank, N.A., d/b/a Wells Fargo Home Mortgage v. LaTouche, the court ruled that Wells did not breach its duty to the borrower to comply with VA foreclosure regulations. The court concluded that the trial court had erred in denying Wells Fargo’s motion for summary judgment as to the defendant’s claims for wrongful foreclosure that hinged upon the same VA regulations. The reversal stemmed from Wells Fargo’s request for an interlocutory review of the trial court’s denial of its motion for summary judgment on defendant Michael LaTouche’s claims for breach of contract, wrongful foreclosure and “surprise. An interlocutory review is undertaken when a question of law must be answered by an appellate court before ...

The nation’s residential subservicing specialists increased their contract base to $1.93 trillion at the end of 2016, a 2.7 percent sequential gain and an impressive 22.9 percent improvement over yearend 2015, according to survey figures compiled by Inside Mortgage Finance. It’s a sign that this segment of the industry is beginning to look a bit crowded, which means profit margins could come under pressure. Over the past year, several fairly large players in the market – Flagstar, Nationstar Mortgage, Walter/Ditech and PHH Mortgage – have sold...[Includes one data table]

A proposal by the Maryland Commissioner of Financial Regulation regarding servicing transfers prompted strong opposition from servicers, who cautioned that it would disrupt mortgage markets. In January, the Maryland CFR proposed a number of amendments to its mortgage regulations. The proposal revised an initial plan from the state regulator back in January 2015. The new proposal included...

Limitations spanning more than three years on Ocwen Financial’s ability to acquire servicing could be ending soon. Company officials stress that a resumption of servicing acquisitions will help Ocwen see some benefits from economies of scale. In the three years since the New York Department of Financial Services started preventing Ocwen from acquiring servicing, Ocwen’s portfolio has declined by more than 50.0 percent, hitting an unpaid principal balance of $209.09 billion ...

Two years after first proposing a regulation addressing mortgage servicing rights transfers, the Maryland Commissioner of Financial Regulation recently issued a revised iteration that could have a big effect on the mortgage servicing industry, according to attorneys with the Ballard Spahr law firm. According to a summary by the attorneys of the technical language of the proposed regulation, for any transfer of MSR involving at least 7,500 loans, the transferee servicer would have to report certain information to the commissioner at least 30 days before date of the transfer. Specifically, the transferee servicer would have to “report whether the transfer involves a subservicing agreement or an agreement for the sale of mortgage servicing rights; the names of the parties to ...

The proposal by the Office of the Comptroller of the Currency to create a special-purpose national bank charter for financial technology companies, including marketplace lenders, stirred up significantly different views during a panel discussion sponsored this week by the Brookings Institute. “The fact that this charter will be designed as one not to support innovation, but to support the biggest and most well-funded players, ends up being bad for consumers because it tilts the market against the true innovators,” said Margaret Liu, senior vice president and deputy general counsel for the Conference of State Bank Supervisors. But, Richard Neiman, head of regulatory and government affairs for Lending Club and former New York state banking commissioner, said...