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Inside the CFPB

October 15, 2018

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Industry Wants Clarity on Non-QM, Calling for Changes to ATR Rule

Originating home loans that don’t meet the qualified-mortgage standard remains a small, but rapidly growing market that’s looking more attractive at a time when agency mortgage lending is slowing. But many lenders are holding back because of a lack of clarity about non-QM compliance. Changes to the ability-to-repay rule may be necessary to move the non-QM niche to the next level, experts say. An estimated $21.5 billion of expanded-credit mortgages ... Read More

Industry Seeks Guidance on Market Services Arrangements; Zillow Wins

A recent court ruling that Zillow’s co-marketing program does not violate the Real Estate Settlement Procedures Act is helpful to the industry, but lenders still need guidance from the CFPB to confirm the standards set by previous rulings, said compliance attorneys. Richard Andreano, a partner at Ballad Spahr, told Inside the CFPB that it is positive for lenders that a federal judge dismissed a lawsuit challenging Zillow’s co-marketing program. The bureau itself ... Read More

CFPB Tweaks Ways to Convey Supervisory Findings to Industry

The CFPB recently announced changes in how it communicates with lenders about supervisory events and how it will articulate supervisory expectations to institutions in the future. The bureau plans to continue sending examination reports and supervisory letters to institutions after exams are completed, according to a bulletin. These reports and letters will include two categories of findings: the matters requiring attention (MRAs) and supervisory ... Read More

Mortgage Group Calls for More Clarification for Trial Disclosures

The Mortgage Bankers Association last week suggested the CFPB provide more clarity in the trial disclosure program. The CFPB in September issued a proposed rule to revise its trial disclosure policy. The new policy would reduce the application burden, clarify timing requirements, establish procedures for extending successful trial disclosure programs, and facilitate coordination with state regulators. “The proposed revision of the [trial disclosure program] ... Read More

Administration Officials Continue Push for Coordination with States

A top CFPB official last week touted the agency’s strategy on fintech and innovation in financial services as a perfect fit with its emphasis on cooperating with state regulators. Paul Watkins, director of the CFPB’s Office of Innovation, said the bureau is taking unique steps to coordinate with state regulators in creating regulatory sandboxes for financial technology companies. He joined other government officials in making remarks at the Bank Policy Institute’s ... Read More

CFPB Drops Proposed Changes to Share Confidential Info With States

The CFPB has abandoned a controversial proposal to expand its disclosure of confidential information through Freedom of Information Act requests. Notably, a new final rule omits the whole part of a previous proposal that would have allowed the CFPB to share confidential information collected in supervisory events with any government agency it deems “relevant to the exercise of the agency’s statutory or regulatory authority.” Such agencies would ... Read More

Dems Ask How the Controversial Fair Lending Chief Was Hired

CFPB Acting Director Mick Mulvaney is resisting outside pressure to dump the controversial political appointee who now leads the agency’s fair lending activities. Eric Blankenstein has come under fire for racially tinged blogs he posted in 2004, where he stated that using the n-word may not necessarily be racist and a great majority of hate crimes were hoaxes. Senate Democrats are pushing Mulvaney to explain how Blankenstein was hired to be head of … Read More

Waters Seeks to Get the CFPB Back to Obama-Era Operation

Rep. Maxine Waters, D-CA, ranking member of the House Financial Services Committee, introduced a bill to undo changes Acting CFPB Director Mick Mulvaney has made to the agency during his tenure. The legislation has no chance in the current session of Congress, but it would likely get on the fast track if Democrats win control of the House in the upcoming midterm elections. “My bill, the Consumer First Act, would reverse the harmful changes the Trump administration ... Read More

Consumer Complaints See Double-Digit Decline in the Third Quarter

Consumer complaints in all major categories saw double-digit declines in the third quarter compared to the second quarter, according to a new analysis by Inside the CFPB. Total gripes filed by the public with the CFPB dropped 11.4 percent from 2Q18 to 3Q18, mainly driven by an 18.9 percent sequential decline in home mortgage complaints. Complaints regarding credit cards dipped 11.4 percent, bank account problems were down 10.8 percent and ... Read More

Other News in Brief: New Settlement; Senate in Recess; Discriminatory Mortgage Lending Charges; Town Hall Meeting

The CFPB recently settled with Bluestem, Eden Prairie, MN, over allegations that the group of firms unfairly delayed payment transfers to third-party debt buyers. The settlement will require the companies to pay a civil money penalty of $200,000. The CFPB alleged that the Bluestem companies, between 2013 and 2016, delayed forwarding payments for more than 31 days in 18,000 instances. In 3,500 of those instances, Bluestem allegedly delayed [Includes four briefs] ... Read More

CFPB to Define What’s ‘Abusive’ Under Its UDAAP Authority

The CFPB will start a rulemaking process to clarify what practices will be deemed “abusive” in the bureau’s sweeping authority to ban unfair, deceptive and abusive acts or practices, said Acting CFPB Director Mick Mulvaney. Speaking at the annual convention of the Mortgage Bankers Association in Washington this week, Mulvaney said Congress has defined “unfair” and “deceptive” practices fairly clearly, but the meaning of “abusive” is not well established in the law.... Read More

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