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Inside the CFPB

October 12, 2009

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2008 HMDA Data Show Bias Patterns Remain

Minority home applicants were more likely to obtain higher-priced loans in 2008 than white borrowers even as the differences in denial rates among racial and ethnic groups remained significant, according to a Federal Reserve analysis of the latest Home Mortgage Disclosure Act data. Compared to previous years, there were fewer higher-priced loans originated in 2008, the HMDA data showed... Read More

Fed’s Quick Action Resolves FHA-TILA Snag

The Federal Reserve last week averted a potential misapplication of new Truth in Lending Act regulations on FHA loans with guidance clarifying that interest charged after full payment of a mortgage loan will not be treated as a prepayment penalty. FHA loans that fall under a new category of “higher-priced mortgage loans” under the Fed’s revamped Regulation Z received an 11th hour... Read More

FFIEC Aligns HMDA, TILA Triggers For Higher-Priced Mortgage Loans

The Federal Financial Institutions Examination Council recently approved updated examination procedures for the Home Mortgage Disclosure Act. The renewed procedures incorporate changes to HMDA’s Regulation C for reporting pricing information on higher-priced loans, which the Federal Reserve published in October last year, according to the FFIEC’s Task Force on Consumer Compliance... Read More

Obama Calls for United Stand Against Efforts to Kill CFPA Plan

President Obama last week urged Americans to oppose efforts to stop the Consumer Financial Protection Agency and called on Congress to act quickly to pass a regulatory reform package by the end of the year. In a related move, the House Financial Services Committee will meet this week to take up Chairman Barney Frank’s discussion draft of a bill to create the agency that would regulate financial... Read More

Senate Loan Workout Bill Could Have Reverse Effect on Borrowers

Senate legislation that would provide borrowers a chance to work out a modification to their troubled loan before foreclosure could have some unintended, adverse consequences, the Consumer Mortgage Coalition warned. S.1731, the “Preserving Homes and Communities Act of 2009,” was introduced last week by Senators Jack Reed, D-RI, and Richard Durbin, D-IL, to help keep families in their homes and... Read More

Equity-Rich Seniors are Prime Target for Ex-Subprime Players

Consumer advocates are calling for stronger measures to protect seniors and prevent the reverse mortgage market from becoming another financial bust. Aggressive lending practices that were common during the subprime market boom are now being used to lure cash-strapped, equity-rich seniors to take out reverse mortgages, and regulators and Congress need to step in before things get out... Read More

Weak FHA Review Process Allows Bad Actors to Sneak into Program

The FHA’s inability to handle the growing number of lender applications has resulted in inefficiencies that allowed previous mortgage players with blemished pasts to gain admission into the FHA single-family insurance program, a recent internal audit has concluded. A recent review of 22 approved lender applications showed flaws in the current FHA control procedures, which have yet to be... Read More

Increased Rating Agency Liability Would Harm Secondary Market

Credit rating agencies cautioned Congress against increasing their liabilities and regulatory burdens, saying it would do the secondary market more harm than good. Top executives of nationally recognized statistical ratings organizations pled their case recently before the House Financial Services Subcommittee on Capital Markets, Insurance, and Government-Sponsored Enterprises... Read More

State Roundup

Connecticut. On Sept. 28, the Commission on Banks issued a maximum fee schedule for “debt negotiation,” including loan modification, short sales or foreclosure rescue activities, performed... North Carolina. On Oct. 1, S.B. 107, which enhances protections available to victims of identity theft, went into effect. In general, the act creates new legal obligations for credit reporting agencies... Read More

Federal Roundup

OCC/OTS: 2Q09 Metrics Report. According to the Office of the Comptroller of the Currency and Office of Thrift Supervision Metrics Report for the second quarter of 2009, home retention actions... Federal Deposit Insurance Corp.:Protecting Tenants. The FDIC issued guidance Sept. 28 regarding the Protecting Tenant at Foreclosure Act, which protects tenants from being evicted from properties... Read More

Worth Noting …

Rep. Scott Garret, R-NJ, has introduced legislation Oct. 1 requiring FHA borrowers... States that adopted tough anti-predatory lending laws had lower foreclosure... Tom Koonce, former assistant vice president and lobbyist for the Independent... The Consumer Bankers Association’s annual Fair Lending Conference will be at... The American Land Title Association will have its annual convention... Read More

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