The mortgage financing industry has expressed support for updated disclosures that would apply to all mortgage lenders and the residential loans they originate, including nontraditional mortgage products. Three major industry groups are in favor of revising Truth in Lending Act regulations to help lenders provide simple but more meaningful disclosures to borrowers, and to involve lenders and consumers in testing to ensure that disclosures are clear and concise... Read More

Consumer advocates are urging the Federal Reserve Board to protect non-English speaking borrowers from unscrupulous mortgage lenders and brokers who sell home loans in languages other than English. These loan negotiations are sealed at the closing table by huge stacks of documents written in English that non-English speaking borrowers do not understand, advocates say... Read More

Industry groups warned that imposing a “suitability” standard on the industry could create significant regulatory and legal risks for lenders. While such a standard has yet to see the light of day in federal regulation or legislation, lenders are concerned that suitability provisions are finding their way into state licensing and consumer protections laws for mortgage lenders... Read More

Seeking to allay mortgage industry fears, the Conference of State Bank Supervisors last week said it plans to develop a shorter guidance on nontraditional mortgages based on the consumer protection provisions in the broader proposed federal guidance. Michael Stevens, CSBS vice president and director of regulatory affairs, said both his group and the American Association of Residential Mortgage Regulators do not intend to beat the federal... Read More

A multi-state project to automate and harmonize mortgage licensing requirements nationwide is causing grave concerns in the mortgage industry. Why it is keeping its skepticism under wraps is unclear, but the Mortgage Bankers Association is having discussions with the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators to try to resolve its gripes. A CSBS official said other minor “evolutionary” issues raised by the MBA are already being addressed... Read More

Rep. Spencer Bachus, R-AL, chairman of the House Financial Services Subcommittee on Financial Institutions and Consumer Credit, vowed to keep anti-predatory lending legislation on the front burner regardless of the party that takes control of Congress after the November elections. Responding to an Inside Regulatory Strategies query regarding the fate of anti-predatory lending legislation, Bachus said predatory lending “continues to be a serious problem... Read More

The private mortgage insurance industry strongly urged federal regulators to step up its issuance of final guidance on non-traditional mortgage to curb undue risk-taking that puts both mortgage lenders and consumers at risk. Specifically citing piggyback loans, the Mortgage Insurance Companies of America expressed concern about the proliferation of poorly underwritten or unsuitable mortgages and home-equity loans and called for rapid... Read More

Competition among the nation’s largest banks for residential home loans stiffened as 17.1 percent acknowledged in a federal survey that they’ve pulled back somewhat on their credit underwriting over the past three months to get new business. But more significant is that 83.3 percent of the 54 banks that were represented in the Federal Reserve Board’s July 2006 survey of loan officers on bank lending practices made no changes to their credit standards... Read More

Standard & Poor’s last week announced it will rate mortgage-backed securities pools that include loans originated in an anti-predatory lending pilot program area within Cook County, IL. S&P’s announcement takes the air out of critics’ arguments that the statutorily mandated pilot program will drive mortgage lenders out of the county or force them to cut back on their subprime lending. Based on its review of the “Predatory Lending Database Pilot... Read More

Michigan. The state Office of Financial and Insurance Services has barred the unauthorized sale of “mortgage impairment” insurance products that function like title insurance. Mortgage-impairment insurance is a hybrid of both mortgage guaranty coverage and “undisclosed lien loss” coverage. In the event of a borrower default, mortgage impairment insurance is a guarantee to pay a mortgage lender’s losses due to foreclosure up to a certain amount... Read More

Federal Emergency Management Agency. Suspension of Flood Insurance Sale. FEMA has released a list of communities where the sale of flood insurance has been suspended for noncompliance with the floodplain management requirements of the federal National Flood Insurance Program. Federally subsidized flood insurance is made available to communities in flood-prone areas if they agree to administer local floodplain management and build new flood... Read More

The Consumer Bankers Association will have its 2006 Home-Equity Lending Conference, Sept. 10-13, at the Omni Orlando Resort at ChampionsGate, Orlando, FL. America’s Community Bankers’ National Compliance and Attorneys Conference & Marketplace will be at the Williamsburg Lodge, Sept. 17-20, in Williamsburg, VA. The Financial Services Roundtable has scheduled its Fall Conference for Sept. 20... Read More