Happy 6th year-old-birthday to the Dodd-Frank Wall Street Reform and Consumer Protection Act. Or is it the CFPB’s 5th “birthday”? For those new to the business, the passage of Dodd-Frank in July 2010 put in place the Consumer Finance Protection Bureau in July of 2011. Lots more below on what it has been up to lately.
In job news, Caliber Home Loans continues to expand its footprint in the Non-Agency space and is actively searching for a Correspondent UW Manager based in the Irving, TX headquarters. This is a highly visible position that will afford the right candidate an opportunity to participate in and contribute to our continued success within the Portfolio Lending Suite of Products. “Be part of the team that is making a difference.” For more information, contact Nancy Corlett.
Ditech suggests, “Help us take the mortgage industry in a new direction. We have a clear vision of where we want to take Ditech. Are you ready to be a catalyst of positive change for our Customers and our company? Originators, our call centers are a fun and productive work environment. We excel at creating a great customer experience, and have a sales oriented culture. Let us show you how you can take your career to new heights. We are a leader in home loans, with a 50 state presence and a recognized and respected brand. Positions are available in Ditech’s Fort Washington (Philadelphia), St. Louis, and Jacksonville, FL locations. Your state licensing is the key to a fast track as a Ditech Home Loan Specialist. Underwriters, Processors, Closers, are you interested in a $2,000.00 signing bonus? Questions can be directed to recruiters Zachary Doering (651-265-5216), Carmen Mohan, or Stacy Gosch (281-404-7864).
Founded in 2008, and licensed in 48 states, New Penn Financial, a Shellpoint Partners company, and its reputation has grown substantially under the guidance of a management team with years of experience in the mortgage industry. New Penn Financial has been recognized in the top 20 Third Party Originations Lenders and was recently voted as being a great mortgage lender to work for by sales professionals. Our Mission is to exceed the expectations of our residential mortgage borrowers and business partners through superior service, simple processes, and effective communications. New Penn Financial is sourcing two strong, experienced sales leader to grow and manage our teams in Southern California and Texas. Please contact Aubrie Cusumano, Manager – Corporate Recruiting, with inquiries.
What’s the number one reason mortgage loan originators and branch managers want to leave their current lender? It isn’t compensation, says Assurance Financial. It’s lack of support from the home office. Assurance has a simple but important value proposition for all producers – we have a solid reputation for closing loans on time. Our operations staff supports you and your team so you can focus on originating new loans rather than worrying about closing your pipeline. Assurance is expanding throughout the Southeast and Southwest and looking to hire branch managers and MLOs in Arizona, Colorado, New Mexico, Texas, Arkansas, Louisiana, Mississippi, Tennessee, Alabama, Ohio, Virginia, North Carolina, South Carolina, Georgia, and Florida. For more information, contact Paul Peters, CMB at 225-239-7948 or visit www.LendTheWay.com/Careers.
Stonegate Mortgage Corporation announced that Bill Dyson has been named SVP, Distributed Retail. In this role, he will be responsible for leading Stonegate’s Distributed Retail Channel. He will report directly to Steve Landes, EVP, Director of National Sales. Congrats to Bill!
Critics, which may or may not include my cat Myrtle, say that the CFPB has made an art of governing and regulating by consent orders and press releases rather than actually establishing rules and regulations. Is it less expensive for the CFPB that way? Consumers are better protected; certainly the large banks are trying to work with the CFPB but some suggest that non-banks, who have taken a large market share from banks, are not working closely with the CFPB. And there are even some that think Richard Cordray wants to be the governor of Ohio or even a candidate for vice president.
You gotta love the CFPB. “The Consumer Financial Protection Bureau announced that its supervisory actions in the first four months of the year uncovered illegal activities in auto finance and payments that led to approximately $24.5 million in restitution to more than 257,000 consumers. The report also highlights issues CFPB examiners found through the agency’s examination of businesses in auto loan origination, debt collection, mortgage origination, and small-dollar lending.” Being a capital markets guy, I am no math whiz, but I think that this works out to about $95 per head – a sum critics say buys dinner for 4 at Applebee’s or less than half of one month’s car loan payment.
There have been setbacks for the regulator. The Consumer Financial Protection Bureau doesn’t have the legal authority to adopt a rule banning arbitration clauses that mention broker-dealers, even if the sole purpose is to exempt broker-dealers from the rule, SIFMA said. The bureau should defer regulation arbitration by entities regulated by the Securities and Exchange Commission to the agency.
Of particular interest to lenders is the news last week regarding HMDA. At this point most, if not all, lenders are collecting the data that will be required. But they are all slicing and dicing the data to see what regulators will find, prior to the regulators finding it. Yes, beginning with data collected in 2017, financial institutions will file their HMDA data with the Consumer Financial Protection Bureau rather than the Federal Reserve Board. The FFIEC and HUD published the following documents on Resources for HMDA Filers to help financial institutions report Home Mortgage Disclosure Act (HMDA) data collected in or after 2017. These materials are also accessible from the FFIEC website: filing instructions guide for HMDA data collected in 2017, filing instructions guide for HMDA data collected in 2018, technology preview, and the endless frequently asked questions. (Appendix A to Regulation C provides instructions for completing the loan/application register for HMDA data collected in 2017 and submitted in 2018, but not for HMDA data collected in 2018 and submitted in 2019.)
For its part the CFPB released a YouTube video on the final rule of HMDA. Yes, the video is an hour, about 57 minutes longer than the typical YouTube video, but one should at least listen to the introduction.
Of course the CFPB is not focused solely on mortgages. At the end of this month the CFPB is expected to release a proposal to regulate debt collection practices. The proposal is expected to expand the definition of debt collector and tighten up activities.
The U.S. subsidiary of Spanish bank Santander was fined $10 million by the CFPB over allegations of deceptive overdraft practices. The bank used a telemarketing vendor to enroll customers in its overdraft service, but the vendor reportedly did so without customer consent.
The industry is certainly watching the CFPB’s chess moves regarding arbitration. “Lewis Wiener, Kymberly Kochis and Frank Nolan of Sutherland Asbill & Brennan write: On May 5, 2016, the CFPB released its proposed regulation on restricting the use of class action waivers and arbitration provisions in consumer contracts. The proposal, if effectuated, would essentially overturn years of U.S. Supreme Court precedent.”
A bipartisan group of 70 U.S. Senators has petitioned CFPB Director Richard Cordray to exclude credit unions from complete CFPB regulatory oversight. “Congress and federal regulators have long taken the approach that credit unions and community banks should be treated differently from the largest financial institutions and non-bank lenders,” the Senators wrote. “It is our hope that the CFPB also takes this approach and considers the impact of its rulemaking on smaller financial institutions and consumers.” In the letter, the Senators urged the Bureau to tailor its financial rules to match the role of community banks and credit unions around the country.
ATS Secured’s new white paper is out, written by former CFPB regulator Ben Olson: Achieve Vendor Management & Mortgage Closing Success in a Post-TRID World. “Get guidance from a former CFPB regulator on safely navigating the full impact of 3rd party risk. Gain valuable insight on; liability, responsibility for disclosures, the true definition of ‘service provider,’ the most important CFPB and TILA-RESPA rule expectations, risk assessment & planning, accuracy of disclosures and permissible changes.”
The CFPB has announced that it plans to host its second research conference on consumer finance on December 15-16, 2016. The announcement contains a call for complete papers or detailed abstracts that include preliminary results to be submitted by August 26. The CFPB is encouraging the submission of a variety of research including, but not limited to, work on “the ways consumers and households make decisions about borrowing, saving, and financial risk-taking; how various forms of credit (mortgage, student loans, credit cards, installment loans, etc.) affect household well-being; the structure and functioning of consumer financial markets; distinct and underserved populations; and relevant innovations in modeling or data.” A particular area of CFPB interest is the dynamics of households’ balance sheets.
BuckleySandler is offering up a free webinar today from 2-3PM EDT titled, “The CFPB in Privacy & Data Security: Examining the Agency’s Role, Authority, and Direction.” “Under the Dodd-Frank Act, the CFPB inherited authority over the privacy provisions, including privacy notices, of the Gramm-Leach-Bliley Act and the Fair Credit Reporting Act. The Dwolla enforcement action announced earlier this year showed that the CFPB also intends to be involved in data security issues and financial institutions of all types should take note. Join our panel of CFPB, privacy, and data security specialists as they discuss the authority of the CFPB in the areas of privacy and data security, the actions the CFPB has taken to date in privacy and security, implications of the Dwolla action, and what CFPB actions in other areas may tell us about where the agency could go in privacy and data security.” One must register at https://attendee.gotowebinar.com/register/8355454217426982403. (Registration is required. Please, no outside law firms, government agency personnel, consulting firms, or media. After registering and being approved, you will receive a confirmation email containing instructions for joining the webinar.)
Lenders, of course, continue to be impacted and to make changes based on CFPB rules. For example…
The industry continues to wait for word on the PHH/CFPB case. PHH’s share price has fallen sharply in 2016 driven both by poor performance and regulatory concerns (reflecting the ongoing issues with the CFPB, FHA, New York State Department of Financial Services, and other state regulators). Analysts point out that PHH’s shares are now trading below 50% of book value, and there is upside as the board pursues strategic actions, including potentially the sale or the liquidation of the company.
Pacific Union has developed a new Change of Circumstance (COC) Form that will better track requirements under TRID and no longer contains references to pre-TRID disclosure requirements.
Be advised, while Sun West accepts initial loan application and applicable disclosures executed prior to closing using electronic signature (“e-signature”), documents must be in compliance with the requirements of the Federal E-Sign Act. Utilization of a Signature Vendor from Sun West’s list of Authorized E-Signature Vendors available in the HELP section of sunsoft is required. At the time of loan submission, an Audit Trail (such as a Certificate of Completion from an Authorized E-Signature Vendor) must be submitted.
Fortunately, throughout all of this rates are minding their own business. (As if rates could do that, right?) Yesterday U.S. Treasuries, and to some extent agency MBS prices, ended the session with moderate losses (worse about .125 but mortgages were only off a few ticks). Why? No good reason, so I won’t waste your time. Suffice it to say the usual entities were selling (lenders & agencies, primarily) and the usual entities were buying (the Fed, money managers, insurance companies, pension funds). But for folks who like to try to predict the future, according to Fed fund futures, the FOMC is virtually guaranteed to hold rates steady when it meets next Tuesday and Wednesday, but the probability of a September hike is up to 25%.
On the subject of central banks, the European Central Bank released its rate decision today and no one thought the ECB would move rates, which is exactly what happened. Here in the US we’ve had this morning’s Initial Jobless Claims for the week ending 7/16 (-1k to 253k) and the second-tier Philadelphia Fed survey for July (-2.9). Coming up, for those who are riveted to data from two months ago, is the May FHFA Housing Price Index. And we’ll also have June’s Existing Home Sales report at 10AM EDT and Leading Economic Indicators. Oh, and at 1PM EDT the Treasury will auction $13 billion in new 10-year TIPS – get out your checkbooks.
As the folks in New York headed for the subway Wednesday we closed the 10-year at a yield of 1.58%. This morning it is wallowing around 1.60% and agency MBS prices are worse nearly .125 versus last night.
A successful man is one who makes more money than his wife can spend. A successful woman is one who can find such a man.
(Copyright 2016 Chrisman LLC. All rights reserved. Occasional paid job listings do appear. This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.)