The Mortgage Bankers Association has recommended steps to address the VA appraiser shortage and increased appraisal turn times. The industry group made its recommendations in a recent letter to Jeffrey London, executive director of the Department of Veterans Affairs’ Loan Guaranty Service, based on a roundtable discussion between MBA and other industry stakeholders in March. Stakeholders expressed their concern for the lack of VA appraisers and longer waiting periods for appraisal reports. Appraiser shortage is an ongoing problem for the VA, and has resulted in delayed loan closings, particularly in highly rural areas. Some states, like Oregon, have very few appraisers, the MBA pointed out.“This delay may force veterans to choose other loan programs to meet certain deadlines or face other adverse outcomes,” the MBA letter warned. On the other hand, the ...

The FHA will provide lenders that originate Home Equity Conversion Mortgage loans the option to view and print unsigned HECM counseling certificates in FHA Connection starting Sept. 18, 2017. While the lender may still take the initial loan application, the lender can only begin to process it once the counseling is complete, as evidenced by a completed HECM counseling certificate that contains signatures of both the counselor and borrower. Lenders that chose to use this option will be required to establish procedures to obtain and document authorization from the HECM borrower to access the counseling certificate in FHA Connection. In addition, lenders must certify that a borrower authorization to view the counseling certificate was obtained. Lenders must follow the guidance on processing HECM loans contained in the HUD Handbook, the FHA said. To access HECM counseling certificates, lenders will ...

An official from the CFPB confirmed late last week the agency is looking into the massive data breach at Equifax, widely seen as the most significant, and potentially most damaging, so far in the age of the Internet. A spokesman for the bureau told this newsletter, “The CFPB has authority over the consumer reporting industry, including supervisory and enforcement authority. The CFPB is authorized to take enforcement action against institutions engaged in unfair, deceptive or abusive acts or practices, or that otherwise violate federal consumer financial laws. We are looking into the data breach and Equifax’s response, but cannot comment further at this time.” However, it’s not just the occurrence of the breach that bothers the consumer regulator. As part ...

Members of Congress wasted no time getting to work on the CFPB when they returned to the nation’s capital last week after the Labor Day holiday. A subcommittee of the House Financial Services Committee held a hearing to consider a few legislative proposals to foster a more efficient federal financial regulatory regime, including a soon-to-be introduced TRID Improvement Act. Slated to be introduced by Rep. French Hill, R-AR, the TRID Improvement Act of 2017 would amend the Real Estate Settlement Procedures Act and the Truth in Lending Act to expand the period in which a creditor is allowed to cure a good-faith violation on a loan estimate or closing disclosure from 60 to 210 days after consummation. The bill also ...

The biggest mortgage lenders and the national industry trade groups have yet to formally submit comments to the CFPB regarding the bureau’s proposal that would close the so-called black hole associated with the agency’s integrated disclosure rule. But smaller players aren’t waiting around for the big dogs to weigh in and are expressing their support for the agency’s proposed solution. Monica Montgomery, head of mortgage compliance for Dubuque Bank & Trust, said she fully supports removing the four-business-day limit for providing closing disclosures for purposes of resetting tolerances and determining if an estimated closing cost was disclosed in good faith. “There are many circumstances where a closing is delayed beyond the control of the creditor after a CD had been ...

A complaint filed in late 2015 in U.S. District Court for the Central District of California in an attempt to initiate a class-action case against PHH Corp. and Realogy Holdings Corp. and some of their subsidiaries and affiliates has been brought to an end, after the defendants agreed to pay $17 million to resolve the dispute. PHH, Realogy and the other industry participants were accused of violating Section 8(a) of the Real Estate Settlement Procedures Act by allegedly “paying and receiving kickbacks, referral fees, or other things of value in connection with the referral of title insurance and other settlement services to Title Resource Group and its affiliates.” They also were accused of running PHH Home Loans as an improper ...

Ocwen Financial Corp. and Ocwen Loan Servicing recently agreed to pay a $1 million fine to resolve an issue of force-placed insurance (FPI) under the national mortgage settlement that was reached in 2014.At issue was the company’s performance as loan servicer as measured against one particular metric, metric 29, the purpose of which is to test whether Ocwen complied with the servicing standards regarding the timeliness of terminating FPI and refunding premiums to affected borrowers. Under the settlement, Ocwen must terminate FPI within 15 days of obtaining proof that a borrower has an existing insurance policy. As it turned out, Ocwen exceeded the mandated error threshold of 5 percent for Metric 29 during the first quarter of 2017, according ...

The CFPB suffered another legal blow recently when a federal district court judge in Atlanta granted defendants’ requests for sanctions against the bureau stemming from its behavior related to the defendants’ depositions of agency witnesses. The action stems from an enforcement action the CFPB brought in April 2015 against a number of individuals and entities in connection with what the bureau alleged was a massive debt-collection scheme. The issue prompting the judge’s crackdown was the CFPB's reluctance and apparent refusal to be deposed by some of the defendants. First, it objected to such depositions. Then when more defendants filed similar notices, the bureau responded with motions for protective orders. Then when depositions finally occurred, a CFPB witness used “memory aids” ...

Last week, the CFPB brought an enforcement action against Zero Parallel, an online lead aggregator based in Glendale, CA, for allegedly steering consumers toward lenders who offered illegal or unlicensed loans that were void in the consumer’s state. According to the bureau, consumers who applied for loans through Zero Parallel’s network had no control over which lenders received their applications. “Zero Parallel regularly sold leads for consumers located in states where the resulting loan was void,” said the consumer regulator. The CFPB ordered Zero Parallel to end its alleged illegal conduct and pay a $100,000 penalty. Also, under the terms of the consent order, Zero Parallel is required to undertake reasonable efforts to ensure that loan applications it sells do ...

State Regulators Start Work on a Next-Generation Technology Platform. The Conference of State Bank Supervisors has initiated what it characterizes as a major redesign of the Nationwide Multistate Licensing System (NMLS), which is the core technology platform state bank regulators utilize. According to the CSBS, the redesign will enable the regulators to transform the licensing and supervision of non-bank financial institutions, including financial technology companies, or so-called fintechs. “Technology and data are powerful tools that can create sweeping benefits throughout the financial regulatory system,” said Louisiana Office of Financial Institutions Commissioner John Ducrest. “And that vision drives our efforts with the next-generation NMLS. We are committed to nothing less than modernized state regulation for a modernized financial services industry.” The ...