Browse articles from all of our Newsletters related to Legislation.

October 19, 2018 - Inside FHA/VA Lending

VA Reboots QM Rule Following Passage of Dodd-Frank Reform Act

The Department of Veterans Affairs will begin a new rulemaking on qualified mortgages to conform to Dodd-Frank reform act mandates. Observers say the move is simply housekeeping, since the previous QM interim final rule (IFR) requirements were rendered moot with the enactment of the Economic Growth, Regulatory Relief, and Consumer Protection Act back in May. The new law, also known as the Dodd-Frank reform act, superseded the previous rule’s seasoning and recoupment requirements for VA Interest Rate Reduction Refinance Loans. Specifically, the act removed the category of rebuttable presumption for IRRRLs deemed as QM under the interim final rule. It also imposed new requirements that were not considered at the time the IFR was issued. The VA did not say whether changes were made ...

October 19, 2018 - Inside FHA/VA Lending

VA Final Rule on Cash-Outs to OMB, Agency Eyes November Issuance

The Department of Veterans Affairs has asked the Office of Management and Budget to review a draft final rule that would establish major requirements for guaranteed cash-out refinance loans. The Economic Growth, Regulatory Relief, and Consumer Protection Act, which reformed the Dodd-Frank Act, gave VA the authority to regulate cash-out refis. The agency has 180 days from enactment to promulgate regulations. The final rule sets the parameters of VA cash-out home loans, to include defining net tangible benefit, recoupment and seasoning requirements. The Dodd-Frank reform act and Ginnie Mae have established similar requirements for Interest Rate Reduction Refinance Loans. IRRRLs and, to a much lesser extent, cash-out refis came under scrutiny due to loan churning or serial refinancing. Last year, a small group of lenders targeted servicemembers and veterans with VA loans to ...

October 15, 2018 - Inside the CFPB

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] ...

October 15, 2018 - Inside the CFPB

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 ...

October 5, 2018 - Inside FHA/VA Lending

Around the Industry

FHA Issues Waiver of Property Inspections in Disaster-Stricken California Counties. FHA has issued a waiver of its timing policy for completing property inspections prior to closing or endorsing a loan for FHA insurance. The waiver is in effect in presidentially declared major disaster areas in Lake and Shasta Counties, CA, that were ravaged by wildfires and high winds. FHA believes that the wildfires and high winds have stabilized so as not to cause any further damage to properties, even though FEMA has not declared “all clear” in the affected areas. The waiver allows damage inspections to be completed after Oct. 2, for properties located in the PDMDA. NC Commissioner of Banks Amends State Reverse Mortgage Rules. The North Carolina Commissioner of Banks recently amended its ...

October 1, 2018 - Inside the CFPB

Other News in Brief: Atlanta Office; Budget for First Quarter of 2019

CFPB to Open Office in Atlanta, Likely to Relocate Over 100 Employees. The CFPB recently announced plans to open a new office in Atlanta as its southeast regional headquarters. The relocation is expected to take place in late 2019. The southeast regional team is currently housed in the bureau’s DC headquarters. The CFPB said the relocation will align the bureau with its regulatory partners that already have a regional presence in Atlanta [Includes two briefs] ...

October 1, 2018 - Inside the CFPB

CFPB Charged by Employees for Discrimination, Again

While the CFPB is responsible for ensuring fairness to American consumers in their financial affairs, the agency is now facing workplace discrimination and retaliation charges from former and current agency employees. A class action complaint was filed against the CFPB and Acting Director Mick Mulvaney in September, alleging discrimination and retaliation against minority and female workers. The complaint was filed to the U.S. District Court for the ...

October 1, 2018 - Inside the CFPB

Disclosure Sandbox Benefits Mortgages; OCC Fintech Charter

The CFPB’s recent efforts to create a regulatory sandbox for financial technology (fintech) companies would benefit the mortgage industry, said a former CFPB attorney. Ever since the agency hired Paul Watkins, a lawyer who helped establish the nation’s first regulatory sandbox for fintech companies, to lead its Office of Innovation in July, fintech regulation has become an area of focus at the bureau. The CFPB in August joined a global fintech regulatory initiative ...

October 1, 2018 - Inside the CFPB

Warren Suggests Mulvaney’s Campaign Donor Meeting Illegal

Sen. Elizabeth Warren, D-MA, has raised ethical questions about Acting CFPB Director Mick Mulvaney’s recent appearance at a “closed-door event” where he reportedly discussed midterm elections with Republican officials and donors. Warren, a harsh Mulvaney critic, said his attendance at the event in New York City on Sept. 8 may have violated the Hatch Act, which prohibits certain employees in the executive branch of the federal government from engaging ...

October 1, 2018 - Inside the CFPB

Industry Group Concerned About HMDA Compliance; Privacy Issue

The American Bankers Association said many questions about new Home Mortgage Disclosure Act reporting remain unanswered and proposed guidance from the CFPB won’t give lenders sufficient legal protection. The CFPB amended the HMDA rule in 2015, implementing expanded data collection fields specifically mandated by the Dodd-Frank Act along with some based on the bureau’s discretionary authority. The net result expanded the required ...

October 1, 2018 - Inside the CFPB

Mortgage Groups Seek Changes to LO Compensation Rule

Mortgage trade groups are asking the CFPB to reopen the loan originator compensation rule to reduce lenders’ regulatory burden and better serve consumers. A dozen industry trade groups – including the American Bankers Association, the Mortgage Bankers Association and the Real Estate Service Providers Council – recently wrote to Acting CFPB Director Mick Mulvaney with suggested changes to the agency’s LO compensation rule under the ...

October 1, 2018 - Inside the CFPB

Secondary Market Unsettled About Liability Under TRID 2.0

The uncertainty about liability and cure mechanisms under the TRID 2.0 disclosure regime could have a negative impact on the secondary market, said compliance experts. Industry groups had sought clarification of liabilities for specific TRID violations, as well as additional cure provisions and bona fide error defenses, during the comment period for proposed amendments to the Truth in Lending Act/Real Estate Settlement Procedures Act Integrated ...

October 1, 2018 - Inside the CFPB

Lenders Prepared for TRID 2.0, Seeking Further Clarification

The revised integrated mortgage disclosure rule takes effect this month, and compliance experts said the industry is ready despite some remaining uncertainty. The CFPB last year finalized amendments to its Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure rule. The revised rule, dubbed TRID 2.0 by the industry, became effective in October 2017, but the agency set Oct. 1, 2018, as the mandatory compliance date ...

September 17, 2018 - Inside the CFPB

Other News in Brief: Model Disclosures; Bill on Guidance; Financial Well-being

CFPB Updates Model Disclosures Under Fair Credit Reporting Act . The CFPB last week issued an interim final rule updating two model disclosures to reflect changes made to the FCRA by the recent Dodd-Frank reform act.The Economic Growth, Regulatory Relief, and Consumer Protection Act, which became law in May, requires nationwide consumer reporting agencies to provide “national security freezes” free of charge to consumers. The [Includes three briefs] ...

September 17, 2018 - Inside the CFPB

CFPB Files First Ever Lawsuit Under Mulvaney, With Some Issues

Almost 10 months into Acting Director Mick Mulvaney’s tenure at the CFPB, the bureau filed its first new lawsuit. The CFPB last week filed charges against Future Income Payments (FIP), Irvine, CA, in federal district court in the Central District of California. The bureau alleged that FIP’s pension-advance products were loans with interest rates “that are substantially higher than credit card interest rates,” according to the complaint, which also names the company's owner ...

September 17, 2018 - Inside the CFPB

CFPB Struck on the CID Process, Hints Review of its Approach

A court panel recently declined to enforce a civil investigative demand issued by the CFPB because the language is too broad and generic. Attorneys said it was the second strike against the bureau for aggressive interpretation of its authority after the D.C. circuit ruled a CID invalid last year. A panel of the U.S. Court of Appeals for the Fifth Circuit held that a CID issued to Source for Public Data – a company that provides public records through an internet-based ...

September 17, 2018 - Inside the CFPB

Constitutionality Challenge Could Reach SCOTUS; Pending Nominee

A community bank in Texas and two DC-based nonprofit groups recently filed a petition with the U.S. Supreme Court challenging the constitutionality of the CFPB’s sole-director structure. The State National Bank of Big Spring, 60 Plus Association, and Competitive Enterprise Institution originally filed a lawsuit in 2012 in the U.S. District Court for the District of Columbia, alleging the CFPB’s structure violated the U.S. Constitution’s separation of powers. The district ...

September 17, 2018 - Inside the CFPB

Advisory Boards Back at CFPB, With New and Fewer Members

Three months after the CFPB fired all the members on its three advisory boards, the agency has reconstituted the panels with fewer members serving shorter terms. The CFPB recently announced nine members for the Consumer Advisory Board, down from 25 during former Director Richard Cordray’s tenure in the agency. Only one of nine comes from the consumer advocacy world – Liz Coyle, executive director at Georgia Watch, which describes itself ...

September 17, 2018 - Inside the CFPB

CFPB Proposes Disclosure Sandbox, and More Could Come

The CFPB is creating a “disclosure sandbox” as its most recent step to encourage fintech innovation. Many are expecting the bureau to tackle the flawed no-action letter policy next. The CFPB recently published a revised policy for its trial disclosure program in the Federal Register. The new policy would streamline the application process, establish procedures for extending successful trial disclosure programs, and allow the CFPB to coordinate with sandbox ...


Who "owns" the mortgage customer that’s brought to a wholesale lender through a loan broker?

The broker. It’s his/her client.


The wholesale/table funder. They’re taking the financial risk.


The broker, but only for the first year. After that, the borrower is fair game.


Hard to answer. It’s a complicated issue.