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Inside the CFPB

December 1, 2008

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RESPA Effective Date Extension Unlikely

The Department of Housing and Urban Development is unlikely to extend the final Real Estate Settlement Procedures Act rule’s effective date for required use, average charges and other amendments beyond Jan. 16, 2009, according to a legal analysis of the new rule. HUD’s bags are packed and the moving vans are waiting, so don’t count on a delayed effective date, said Phillip... Read More

FDIC’s Loss-Share Plan Raising Concerns

Despite winning over a number of House lawmakers, an ambitious loan modification proposal unveiled by Federal Deposit Insurance Corp. Chairman Sheila Bair last month is raising concerns among compliance experts. The proposal based on IndyMac Federal Bank’s loan workout model could place a legal burden on mortgage servicers that goes beyond their traditional duties and responsibilities, warned... Read More

Cramdown Returns to Congress, Passage Next Year Seems Likely

Cramdown proponents reintroduced legislation that is widely expected to place the issue atop Congress’ 2009 list of measures to provide foreclosure relief to homeowners. Disappointment over the slow pace of loan modification programs has caused congressional Democrats to reconsider cramdown legislation that would authorize courts to reduce a portion of a residential mortgage in a... Read More

Paulson Asked to Pick Program: Frank Seeks TARP Funding for Aggressive Modification Plans

House Financial Services Committee Chairman Barney Frank, D-MA, strongly urged the Bush administration to choose among a number of aggressive foreclosure prevention initiatives that can be supported by the Troubled Asset Relief Program to mitigate the massive wave of foreclosures expected over the next two years. In a Nov. 20 letter to Treasury Secretary Henry Paulson, Frank said Treasury’s... Read More

GSEs Freeze Foreclosure Sales

Fannie Mae and Freddie Mac directed their servicers and retained foreclosure attorneys to suspend foreclosure sales and evictions on occupied single-family properties from Nov. 26, 2008, through Jan. 9, 2009. The government-sponsored enterprises’ moratorium will remain while they implement the streamlined modification program they announced Nov. 11 and scheduled to launch Dec. 15... Read More

New HOEPA Triggers Push Jumbo Primes into High-Cost Column

The Consumer Mortgage Coalition urged the Federal Reserve Board to review the new uniform “higher-priced” home loan triggers finalized under regulations implementing the Home Ownership and Equity Protection Act and the Home Mortgage Disclosure Act. The trade association fears that the uniform higher-priced loan thresholds set recently under HMDA’s Regulation C and TILA-HOEPA’s... Read More

OTS Calls Upon Thrifts to Watch for Disparities in Price, Loan Decision

Federally regulated thrifts must remain vigilant about their practices, policies and procedures, and underwriting standards to avoid potentially discriminatory disparities in pricing and lending decisions. The Office of Thrift Supervision issued the reminder, Thrift Bulletin 25a, to thrifts Nov. 19 to be aware of the fair lending implications in the 2007 Home Mortgage Disclosure Act... Read More

ECOA Changes Added to OTS Fair Lending Exam Manual

The Office of Thrift Supervision has incorporated into its examination manual revisions from the Federal Reserve’s finalized amendment of Equal Credit Opportunity Act regulations. The changes to Regulation B, which implements ECOA, are intended to replace Section 1205 in the OTS Examination Handbook. The revised Reg B... Read More

State Roundup

Conference of State Bank Supervisors. The CSBS has formed a regulatory restructuring task force to develop... Colorado. “Loan modifiers” – those who directly or indirectly negotiate a loan modification – may be required to be... Maryland. On Nov. 7, Gov. Martin O’Malley and six major mortgage servicers jointly announced an improved loss mitigation process... Read More

Federal Roundup

Office of Thrift Supervision: Two CA Thrifts Seized. The OTS has padlocked two California thrifts – Downey Savings and Loan Asso. of Newport Beach, and... Federal Deposit Insurance Corp.: Temporary West Coast Satellite Office. The FDIC will open a temporary office in Irvine, CA, to manage receiverships and... Read More

Worth Noting …

Applications for government-insured loans have jumped to 32.9 percent, which is the highest level seen since... The National Association of Black Mortgage Brokers called for the reinstatement of seller-funded downpayment... Beginning March 1 next year, Freddie Mac will no longer purchase stated income/stated asset home loans... Read More

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