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Inside Mortgage Finance

July 13, 2012

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CFPB Raising Compliance Bar for Mortgage Lenders On Consumer Disclosures, a Number of Other Fronts

After months of high-profile publicly and seemingly endless prototypes, consumer testing and discussions with industry stakeholders, the Consumer Financial Protection Bureau this week issued a detailed proposed rule to integrate the mortgage disclosures consumers get under the Real Estate Settlement Procedures Act and the Truth in Lending Act. The proposal features new “loan estimate” and “closing disclosure” forms to highlight the costs and risks of a mortgage in terms designed to be clearer to consumers and to facilitate shopping. According to the CFPB... Read More

Industry Again Calls for Broad Qualified Mortgage, Well-Defined Ability to Repay, Strong Safe Harbor

As the Consumer Financial Protection Bureau works to finalize its ability-to-repay qualified mortgage final rule by January, industry officials again called upon Congress to press the bureau to broadly structure the terms of a qualified mortgage and craft a well-defined ability-to-repay rule, along with a strong safe harbor to help provide legal certainty. John Hudson, chairman of government affairs for the National Association of Mortgage Brokers, told lawmakers that industry professionals and “every consumer wanting to participate in homeowner-ship supports common sense underwriting ... Read More

Most Lenders Track Market’s Heavy Refi Volume,But Some Specialize in Growing Purchase Market

With refinance transactions accounting for three out of four home mortgages financed through agency programs in the first half of 2012, most top lenders securitized significant volumes of refi loans through Fannie Mae, Freddie Mac and Ginnie Mae.But a new Inside Mortgage Finance analysis and ranking reveals that a number of lenders man-aged to focus on the fast-growing home purchase-mortgage market during the first half of 2012. At the top of that list was Pulte Mortgage, the subsidiary of a national homebuilding company, where pur-chase-money mortgages accounted for 99.0 percent of... Read More

Fitch: Fannie, Freddie See New Targets of Buyback Opportunity in Mid-Tier Financial Institutions

Mortgage repurchase requests by Fannie Mae and Freddie Mac show no signs of slowing down, and the two government-sponsored enterprises appear poised to pick up the pace with buyback de-mands targeting mid-tier financial institutions, warned Fitch Ratings. Fitch issued a note last week in which the rating agency cited signs of a potential shift in focus by the GSEs from the big banks to the smaller regional banks as a target of opportunity for increased representation and warranty claims.“Recent announcements by PNC, SunTrust and First Horizon that they intend to boost future GSE ... Read More

Report: Countrywide Downgraded Underwriting Standards To Offer Discount Loans to ‘Friends of Angelo’ for Influence

For more than a decade, Countrywide Financial’s “VIP Program” approved nearly 18,000 sweet-heart mortgages to congressmen, policymakers and officials at the government-sponsored enterprises in an effort to curry favor in Washington and strengthen its business relationship with Fannie Mae, ac-cording to a newly released congressional inquiry. Last week’s 136-page report from House Oversight and Government Reform Committee Chair-man Darrell Issa, R-CA, completed a three-year investigation by the committee of Countrywide’s “Friends of Angelo” program, which ran from January ... Read More

CFPB Proposed Rule Aims to Crack Down on Abuses Associated With High-Cost Mortgages

Consumers who take out mortgages that are considered high cost currently receive special pro-tections from fees and risky loan terms. The Consumer Financial Protection Bureau this week came out with a proposed rule that would expand what is considered a high]cost mortgage and provide more protections to consumers who take out those loans. Loans that meet high-cost triggers under the Home Ownership and Equity Protection Act are subject to special disclosure requirements and restrictions on loan terms, and borrowers in high-cost mortgages have enhanced remedies ... Read More

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