Tag Archives: mlo

Oregon’s Senate Bill 879 – Exemptions from Mortgage Loan Originator (MLO) License Requirement

Oregon bill exempts certain individuals from the requirement to hold a mortgage loan originator’s license

By Jeff Sorg, OnlineEd Blog

onlineed news(December 24, 2015) – Senate Bill 879 exempts an individual from the requirement to hold a mortgage loan originator’s license who sells, offers, or negotiates terms of up to three residential mortgage loans secured by dwelling unit owned by an individual or a limited liability company, of which individual is a member, during any 12-month period. The exemption is limited to liability companies consisting of an individual and family members and prohibits an individual or limited liability company from advertising that it is in business of making loans. Finally, the bill limits to holding no more than eight residential loans and requires the individual claiming this exemption to disclose all loans that the limited liability companies hold in aggregate.

In addition, Senate Bill 879 exempts an attorney from having to hold a mortgage loan originator’s license if the attorney negotiates the terms of a residential mortgage loan in representing a client and does not receive compensation from a mortgage banker, broker, loan originator, or lender unless the compensation is from a client who has specified an exemption from the requirement to hold a mortgage loan originators license.

SB 879 becomes effective January 1, 2016.

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For more information about OnlineEd and their education for real estate brokers, principal brokers, property managers, and mortgage brokers, visit www.OnlineEd.com.

 All information contained in this posting is deemed correct as of the date of publication, but is not guaranteed by the author and may have been obtained by third-party sources. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

NMLS Smart Deadlines for 2014 License Renewal

(OnlineEd – Jeff Sorg) – The deadline to complete NMLS CE for MLO license renewal is December 31, 2014. However, NMLS Rules allow course providers seven days to report their course completions to NMLS. This means licensees will not want to wait until the last minute before completing their education requirement. If the licensee completes before the deadline, but the provider does not submit until after the deadline, the licensee is prevented from submitting for renewal on time.

In order to allow enough time for CE to be reported into the system and for the MLO to file for renewal, NMLS sets Smart Deadlines each year. These 2014 Smart Deadlines are:

SMART: Course(s) reported by your provider to NMLS by Friday, December 19
AT RISK TO MISS: Course(s) reported by your provider to NMLS by Friday, December 26
GUARANTEED TO MISS: Course(s) reported by your provider to NMLS on Wednesday, December 31

At OnlineEd®, we report your course completions just as fast as we possibly can! This means completions are usually reported to NMLS not later than the next business day from completion (weekends, holidays, and NMLS closures excluded). For completions during the At Risk to Miss and Guaranteed To Miss, we upload completions several times daily. While we do as much as we possibly can to upload in a timely manner, it remains the licensee’s responsibility to know the rules and complete in time for provider reporting to take place before the deadline.

 

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This article was published on July 31, 2014. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author. Due to the fluid nature of the subject matter, regulations, requirements and laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

For more information about OnlineEd and their education for real estate and mortgage brokers, visit www.OnlineEd.com. OnlineEd is NMLS Sponsor: 1400327

Consumer Financial Protection Bureau, Federal Partners, and State Attorneys General File Order Requiring Suntrust to Provide $540 Million in Relief to Homeowners for Servicing Wrongs

Company Also Ordered to Pay $10 Million for Servicing Misconduct and Fined $418 Million by the DOJ

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SunTrust to Provide $540 Million in Relief to Homeowners

(CFPB -WASHINGTON, D.C.) — Today the Consumer Financial Protection Bureau (CFPB), Department of Justice (DOJ), Department of Housing and Urban Development (HUD), and attorneys general in 49 states and the District of Columbia filed a proposed federal court order requiring SunTrust Mortgage, Inc. to provide $500 million in loss-mitigation relief to underwater borrowers. The order also requires SunTrust to pay $40 million to approximately 48,000 consumers who lost their homes to foreclosure and $10 million to the federal government. The order addresses systemic mortgage servicing misconduct, including robo-signing and illegal foreclosure practices. SunTrust must also pay a $418 million penalty, in a parallel mortgage lending filing announced by DOJ today.

 “Deceptive and illegal mortgage servicing practices have pushed families into foreclosure and devastated communities across the nation,” said CFPB Director Richard Cordray. “Today’s action will help homeowners and consumers harmed by SunTrust’s unlawful foreclosure practices. The Consumer Bureau will continue to investigate mortgage servicers that mistreat consumers, and we will not hesitate to take action against any company that violates our new servicing rules.”

SunTrust is a mortgage lender and servicer headquartered in Richmond, Va., and is a wholly-owned subsidiary of Atlanta-based SunTrust Banks, Inc. As a mortgage servicer, it is responsible for collecting payments from the mortgage borrower on behalf of the owner of the loan. It handles customer service, collections, loan modifications, and foreclosures.

 The CFPB, DOJ, HUD, and state attorneys general uncovered substantial evidence that SunTrust was engaged in systemic mortgage servicing misconduct. According to the complaint filed in the federal district court in the District of Columbia, SunTrust’s illegal practices put thousands of people at risk of losing their homes. Specifically, the complaint alleges that SunTrust:

  •  Took advantage of homeowners with servicing shortcuts and unauthorized fees: SunTrust failed to promptly and accurately apply payments made by borrowers, and charged unauthorized fees for default-related services.
  •  Deceived homeowners about foreclosure alternatives and improperly denied loan modifications: SunTrust failed to provide accurate information about loan modification and other loss-mitigation services, failed to properly process borrowers’ applications and calculate their eligibility for loan modifications, and provided false or misleading reasons for denying loan modifications.
  • Engaged in illegal foreclosure practices: SunTrust provided false or misleading information to consumers about the status of foreclosure proceedings where the borrower was in good faith actively pursuing a loss mitigation alternative also offered by SunTrust. The company also robo-signed foreclosure documents, including preparing and filing affidavits whose signers had not actually reviewed any information to verify the claims.

Enforcement Action

Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has the authority to take action against institutions engaging in unfair, deceptive, or abusive practices. Today’s proposed court order, filed in federal district court in the District of Columbia, would require SunTrust to correct their practices and provide relief to harmed consumers. Under the terms of the order, SunTrust must:

  • Provide at least $500 million in relief to underwater borrowers: Over a three-year period, SunTrust must provide more than $500 million in loss mitigation relief to consumers, including reducing the principal on mortgages for borrowers who are at risk of default and reducing mortgage interest rates for homeowners who are current but underwater on their mortgages. If SunTrust fails to meet this requirement, it must pay a cash penalty equal to at least 125 percent of the shortfall.
  •  Provide $40 million in refunds to foreclosure victims: SunTrust must refund $40 million to consumers whose loans it serviced who lost their homes to foreclosure between Jan. 1, 2008 to Dec. 31, 2013. All consumers who submit valid claims will receive an equal share of the $40 million. Borrowers who receive payments will not have to release any claims and will be free to seek additional relief in the courts. Eligible consumers can expect to hear from the settlement administrator about potential payments later this year.
  •  Pay $10 million to the federal government: SunTrust must pay $10 million to cover losses it caused to the Federal Housing Administration, Department of Veterans Affairs, and the Rural Housing Service.
  •  Homeowner protections: Today’s order will require SunTrust to establish additional homeowner protections, including protections for consumers in bankruptcy. Like other servicers, SunTrust is subject to the CFPB’s new mortgage servicing rules that took effect on January 10, 2014. The agreement only covers SunTrust’s violations before the new rules took effect, and does not prevent the CFPB from pursuing civil enforcement actions against SunTrust for violations of these rules.  

 A copy of the SunTrust complaint that was also filed in the federal court in the District of Columbia will be posted at: http://www.consumerfinance.gov/

The complaint is not a finding or ruling that the defendants have actually violated the law. The proposed federal court order will have the full force of law only when signed by the presiding judge.

The settlement administrator will be in touch with eligible consumers who lost their homes to foreclosure between Jan. 1, 2008 and Dec. 31, 2013.  Consumers who are interested in loss mitigation should contact SunTrust at 1-800-634-7928 or by email through the SunTrust Mortgage, Inc. support page at www.SunTrustMortgage.com.

CFPB Orders Connecticut Lender to Pay $83,000 Civil Penalty

Pay Fine

Connecticut Lender to Pay $83,000

(Consumer Financial Protection Bureau – Washington, D.C.) Today, the Consumer Financial Protection Bureau ordered a Connecticut mortgage lender, 1st Alliance Lending, LLC (First Alliance), to pay an $83,000 civil money penalty for violating federal law by illegally splitting real estate settlement fees. First Alliance self-reported these violations to the Bureau, admitted liability, and provided information related to the conduct of other actors that has facilitated other enforcement investigations.

“These types of illegal payments can harm consumers by driving up the costs of mortgage settlements,” said CFPB Director Richard Cordray. “The Bureau will use its enforcement authority to ensure that these types of practices are halted. We will, however, also continue to take into account the self-reporting and cooperation of companies in determining how to resolve such matters.”

First Alliance is a mortgage lender in East Hartford, Conn. that focuses primarily on providing loss-mitigation financing to distressed borrowers. First Alliance obtains troubled mortgages from mortgage servicers, and reaches out to consumers to offer them new loans with reduced principal amounts under federally related mortgage programs.

First Alliance started using a hedge fund to finance its loans in 2010. Under this arrangement, First Alliance split revenues and fees with affiliates of the hedge fund. In 2011, First Alliance secured less costly financing and ended its arrangement with the hedge fund and its affiliates. Although the hedge fund and its affiliates no longer financed First Alliance’s mortgages, First Alliance continued to split origination and loss-mitigation fees with them. The hedge-fund affiliates received payments from 83 First Alliance loans made between August 2011 and April 2012.

In 2013, First Alliance reported to the Bureau that it believed it had violated the Real Estate Settlement Procedures Act (RESPA) by paying these unearned fees. RESPA bans a person from paying or receiving a portion or split of a fee that has not been earned in connection with a real estate settlement. First Alliance cooperated with the Bureau’s investigation, and the Bureau concluded that First Alliance’s payments to the hedge fund and its affiliates had violated RESPA. First Alliance’s self-reporting and cooperation, consistent with the Bureau’s Responsible Business Conduct bulletin published on June 25, 2013, were taken into account in resolving this matter.

Under the terms of today’s consent order, First Alliance is required to pay a civil money penalty of $83,000 to the Bureau and agrees not to violate RESPA in the future. The Bureau will continue to enforce RESPA’s provisions to protect consumers and to deter unlawful activity.

A copy of the Bureau’s consent order is available here: http://files.consumerfinance.gov/f/201402_cfpb_consent-order_first-alliance.pdf

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 For more information about OnlineEd and their pre-license and continuing education for real estate and mortgage brokers, please visit www.OnlineEd.com. For more information about mortgage-specific products for compliance training, tracking, and management, please visit  https://www.onlineed.com/inlineed.php or contact Joseph Mikkelson at 1.866.519.9597.

This article was published on February 25, 2014. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author. Due to the fluid nature of the subject matter, regulations, requirements, laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

Oregon Amends Provisions of Foreclosure Avoidance Notice

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Oregon amends Foreclosure Avoidance Measure Notice

(Jeff Sorg, OnlineEd – Portland, OR) Oregon has amended the provisions of its Foreclosure Avoidance Notice by providing for the form and content of the notice when a lender determines that a homeowner is not eligible for foreclosure avoidance measures or has not complied with an already agreed upon avoidance measure.

The form [Form 20] requires the lender to include homeowner name, lender name, and the subject property address. The lender will then check an appropriate box on the form indicating either that the homeowner is not eligible for any foreclosure avoidance measure or that the homeowner is not in compliance with the terms of an agreement already reached with the lender. The lender must describe with specificity and in plain language their basis for their determination. The form also notifies the homeowner of the date and location set for the sale of the property, cautions the homeowner to seek legal advice, and provides information about agencies and organizations to assist the homeowner.

View  or download a copy of this form.

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For more information about OnlineEd’s mortgage and real estate broker education visit www.OnlineEd.com. For more information about mortgage-specific learning management systems and products for compliance training, tracking, and management visit  https://www.onlineed.com/inlineed.php or contact Joseph Mikkelson at 1.866.519.9597.

This article was published on February 12, 2014. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author. Due to the fluid nature of the subject matter, regulations, requirements, laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

CFPB Seeks Constent Order Against Castle & Cooke for $13 Million

(CFPB – WASHINGTON, D.C.)  The Consumer Financial Protection Bureau (CFPB) today announced a proposed consent order in its enforcement action against Castle & Cooke Mortgage, LLC, for allegedly steering consumers into costlier mortgages. The Bureau has asked a federal district court to approve a consent order that would provide more than $9 million in restitution for consumers and obtain $4 million in civil money penalties against Castle & Cooke and two of its officers for allegedly paying loan officers illegal bonuses.

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Mortgage Loan Originators were allegedly paid illegal bonuses for steering consumers into mortgages with higher interest rates.

“Our action has put an end to illegal steering of consumers and has put more than $9 million back in their pockets,” said CFPB Director Richard Cordray. “This outcome embodies our mission—to root out bad practices from the marketplace and ensure consumers are being treated fairly.”

Castle & Cooke is a  Utah-based mortgage company that originated about $1.3 billion in loans in 2012. The company maintains 45 branches and does business in 22 states, including Arizona, California, Colorado, Florida, Hawaii, Iowa, Idaho, Nebraska, New Mexico, Nevada, Texas, and Utah. On July 23, 2013, the CFPB filed a complaint in federal district court against the mortgage company and two of its officers for allegedly paying illegal bonuses to loan officers who steered consumers into mortgages with higher interest rates.

The complaint alleged that Castle & Cooke, through actions taken by its president, Matthew A. Pineda, and senior vice-president of capital markets, Buck L. Hawkins, violated the Federal Reserve Board’s Loan Originator Compensation Rule by paying loan officers quarterly bonuses that varied based on the interest rate of the loans they offered to borrowers. That rule banned compensation based on loan terms such as the interest rate of the loan. The rule had a mandatory compliance date of April 6, 2011, and authority over that rule transferred to the CFPB on July 21, 2011. The CFPB estimates that more than 1,100 quarterly bonuses were paid to over 215 Castle & Cooke loan officers.

Enforcement Action

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has the authority to take action against institutions for violations of federal consumer financial protection laws. To ensure that all impacted consumers are repaid and that consumers are no longer subject to these illegal practices, the defendants have agreed to:

  • End unlawful compensation practices: Castle & Cooke must end compensation practices, such as giving loan officers bonuses that vary based on the interest rate of the loans they offered to consumers, that violate the Loan Originator Compensation Rule.
  • Pay $9,232,896 toward consumer redress: The defendants will pay $9,232,896 to administer redress to consumers for their actions. Any borrower who has obtained a home loan from a Castle & Cooke loan officer since April 6, 2011, and whose loan officer received a quarterly bonus from Castle & Cooke for that loan, will receive a check as a result of today’s action. The Bureau estimates that more than 9,400 consumers will receive checks.
  • Pay a $4 million civil money penalty: The defendants – Castle & Cooke, Pineda, and Hawkins – will pay $4 million to the CFPB’s Civil Penalty Fund for their alleged violations.
  • Ensure that Castle & Cooke retain records of compensation: Castle & Cooke will abide by federal law that requires creditors to retain evidence of compliance, such as payroll records.

This case was originally referred to the CFPB by investigators with the Utah Department of Commerce, Division of Real Estate. The complaint was filed in the United States District Court for the District of Utah, where the company is located and where the individual defendants reside.

A copy of the proposed consent order, which will not be final until approved by the court, can be found at:http://files.consumerfinance.gov/f/201311_cfpb_proposed-final-order_castle-cooke.pdf

A copy of the complaint filed in July can be found at: http://www.consumerfinance.gov/f/201307_cfpb_complaint_Castle-and-Cooke-Complaint.pdf

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For more information about OnlineEd, their mortgage loan originator compliance training program and education compliance management system, please visit www.InlineEd.comwww.onlineed.com,  or contact Joseph Mikkelson at 1.866.519.9597.

This article was published on November 7, 2013. All information contained in this posting is deemed correct and current as of this date, but is not guaranteed by the author and was obtained by third party sources. Due to the fluid nature of the subject matter, regulations, requirements, laws, prices and all other information may or may not be correct in the future and should be verified if cited, shared or otherwise republished.

CFPB to Drop Enforcement Attorneys in Mortgage Lender Examinations

(OnlineEd – Portland, OR) Good news from the CFPB – they’re still not quite speaking softly, but starting in November at least, they’re leaving the big stick at home.

The Consumer Financial Protection Bureau confirmed earlier this month that enforcement attorneys would no longer be accompanying examiners in on-site exams of mortgage lenders.

The CFPB began the practice of having an enforcement attorney present at exams starting in 2012. This practice led to uneasiness in lenders and often made the process more costly. Detractors also argued that this practice limited the effectiveness of the examination process and differs from the practices of other federal regulators.

Beginning November, however, the agency will no longer have enforcement attorneys present at exams. According to a Bureau spokeswoman:

“We found that it wasn’t efficient to have both examiners and enforcement attorneys physically present on exams,” said the CFPB spokeswoman.  “We think this approach will result in better overall oversight.”

However, just because enforcement attorneys are on the bench, doesn’t mean that they will be uninvolved.  The CFPB made sure to clarify that enforcement attorneys will still be working with examiners:

“Supervision Examiners and enforcement attorneys will continue to work closely to ensure that the financial institutions that we oversee are following the rules.”

Not all of the news coming out of the CFPB is good, with many mortgage lenders struggling to make changes to comply with several January final rule effective dates, but this news should encourage mortgage lenders and should help relieve some of the stress and burden on the industry.

 

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CFPB Releases Second Update Of Exam Procedures For Mortgage Rules

(CFPB – WASHINGTON, D.C.) On August 15, 2013 the Consumer Financial Protection Bureau (CFPB) released a second update to its exam procedures in connection with the new mortgage regulations issued in January 2013. The interim exam procedures offer valuable guidance to financial institutions and mortgage companies on what the CFPB will be looking for as the rules become effective.

“We are committed to transparency around our examination process,” said CFPB Director Richard Cordray. “So we have worked hard to provide industry with advance notice of what we will be expecting. That, in turn, will improve compliance and benefit consumers.”

The CFPB issued several new regulations reforming the mortgage market in January 2013. Many of the new rules were directed by the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act. The rules cover the various stages of a consumer’s mortgage experience, from shopping for a loan to paying it off. Most of the CFPB’s new rules go into effect in January 2014.

Today’s updates cover the Ability-to-Repay/Qualified Mortgages, high-cost mortgages, and appraisals for higher-priced mortgage loans, as well as new amendments related to the escrows rule. The updates also cover recent changes to credit card rules. With today’s release, the exam procedures now cover the Bureau’s mortgage origination rules issued through May 29, 2013, and mortgage servicing rules issued through July 10, 2013.

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Are you prepared for your CFPB exam?

Today’s release of exam procedures will help financial institutions and mortgage companies understand and prepare for how they will be examined for CFPB rules that, among other things:

  • Require lenders to evaluate a borrower’s ability to pay back the loan: Under the Ability-to-Repay rule, lenders must look at a consumer’s financial information and verify its accuracy. Lenders then must evaluate the information and conclude that the borrower can repay the loan. Lenders may not base their evaluation of a consumer’s ability to repay on teaser rates. They must determine the consumer’s ability to repay both the principal and the interest over the long term − not just during an introductory period when the rate may be lower.
  • Ban or limit certain points, fees, and risky features: Both the rule on Ability-to-Repay and the rule on high-cost mortgages ban or limit certain points, fees, and risky features. Under the Ability-to-Repay rule, a Qualified Mortgage is subject to limitations on points and fees and cannot have loan features such as terms that exceed 30 years or interest-only payments. Under the high-cost mortgages rule, balloon payments and fees for modifying loans are generally banned.
  • Require servicers to provide monthly statements and disclosures: Mortgage servicers must provide regular statements which include: the amount and due date of the next payment; a breakdown of payments by principal, interest, fees, and escrow; and recent transaction activity. For most adjustable-rate mortgages, they must also provide disclosures before the first interest rate adjustment, and before interest rate adjustments alter the payment amount.
  • Restrict dual-tracking: Under the Bureau’s rule on mortgage servicing, dual-tracking – when the servicer moves forward with foreclosure while simultaneously working with the borrower to avoid foreclosure – is restricted. Servicers cannot start a foreclosure proceeding if a borrower has already submitted a complete application for a loan modification or other alternative to foreclosure and that application is still pending review.
  • Require access to servicing personnel and a fair review process: Mortgage servicers must have policies and procedures in place to provide delinquent borrowers with direct, easy, ongoing access to employees responsible for helping them. If a foreclosure seems likely, the servicer must consider all alternatives available from the mortgage owners or investors to help the borrower retain the home.
  • Require creditors use a licensed or certified appraiser: The interagency rule from January 2013 on appraisal requirements for higher-priced mortgage loans requires that creditors use a licensed or certified appraiser to prepare a written appraisal report based on a physical inspection of the interior of the property. The rule also requires creditors to disclose to applicants information about the purpose of the appraisal and provide consumers with a free copy of any appraisal report.

The CFPB is sharing with industry what it will be looking for in its examinations under the new rules by updating the applicable sections of the exam procedure manuals for the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA). These documents are intended for use by CFPB examiners in examining the mortgage companies and other financial institutions subject to the new regulations.

The CFPB is committed to ensuring that the mortgage industry complies with the new consumer protections. Throughout 2013, the CFPB has been working for a smooth transition. It has published plain-language guides. It plans to educate the public about their protections under the new rules. The CFPB is also coordinating with other federal government regulators that also conduct examinations of mortgage companies and financial institutions to ensure all regulators have a shared understanding of the CFPB’s new rules.

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 The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.

OnlineEd is a provider of mortgage and real estate continuing and pre-license education and developer of InlineEd a compliance and learning management tracking system for the mortgage industry.

CFPB Finalizes April Clarifications to Mortgage Rules

Rule Will Improve Consumer Protections in Qualified Mortgages and Mortgage Servicing

(CFPB, WASHINGTON, D.C.) — Today, the Consumer Financial Protection Bureau (CFPB) finalized corrections, clarifications, and amendments to its Ability-to-Repay and mortgage servicing rules. Today’s clarifications were first proposed in April 2013 and reflect the Bureau’s commitment to facilitating implementation in order to better protect consumers.

“We know that effective implementation helps our rules deliver their intended value to consumers,” said CFPB Director Richard Cordray. “We are listening closely to feedback on our rules, and today’s clarifications show our willingness to make appropriate adjustments to achieve that goal.”

The CFPB finalized several mortgage rules in January 2013. Of those, today’s rule focuses on the Ability-to-Repay and Servicing rules. The Ability-to-Repay rule protects consumers from irresponsible mortgage lending by requiring that lenders make a reasonable, good-faith determination that prospective borrowers have the ability to repay their loans. The mortgage servicing rules establish strong protections for homeowners as they repay their loans, and especially for those facing foreclosure.

Among other things, today’s final rule:

  • Clarifies how to determine a consumer’s debt-to-income (DTI) ratio: Under the Ability-to-Repay rule, a lender may make a Qualified Mortgage (QM), a loan for which certain features are prohibited and fees that can be charged are limited. The main type of Qualified Mortgage requires that a consumer’s monthly debt payments, including the mortgage, will not be more than 43 percent of the consumer’s monthly income. Today’s rule clarifies and amends how several factors can be used to calculate a consumer’s DTI ratio. Such factors include a consumer’s employment record and income, business credit reports and other documents relating to self-employed consumers, Social Security income, and non-employment related income such as from a trust or rental property.
  • Explains that CFPB’s RESPA rule does not preempt the field of servicing regulation by states: The preamble to the Bureau’s final mortgage servicing rules made clear that CFPB authority on servicing, from the Real Estate Settlement Procedures Act (RESPA), does not preempt the field of possible mortgage servicing regulation by states. In today’s final rule, the Bureau is adding a comment to expressly state this point and explain how RESPA preemption works.
  • Establishes which mortgage loans to consider in determining small servicer status: The servicing rules issued in January included an exemption from some requirements for small servicers. Today’s changes clarify which mortgage loans will be considered in determining whether a servicer qualifies as small. For example, loans serviced on a charitable basis will not be considered in making that determination.
  • Clarifies the eligibility standard of the temporary QM provision: Under the Ability-to-Repay rule, a loan can be a Qualified Mortgage if it is eligible for purchase, guarantee, or insurance by government sponsored enterprises (GSEs) or by certain federal agencies, provided the loan does not contain certain risky loan features and meets certain limitations on points and fees. Today’s rule clarifies the standards that a loan must meet if the creditor is underwriting it based on GSE or agency guidelines. For example, where a loan is eligible for GSE or agency purchase, guarantee, or insurance, creditors do not need to satisfy the types of procedural and technical requirements that are completely unrelated to the consumer’s ability to repay.

The CFPB is committed to facilitating the mortgage industry’s compliance with the new consumer protections. Throughout 2013, the CFPB has been working for a smooth transition to compliance with the rules. It has issued other clarifications and updates to the rules to help with implementation. The CFPB has published plain-language guides and plans to educate the public about their protections under the new rules. The Bureau plans to publish additional interim examination procedures. The CFPB will also soon publish its first round of exam procedures for the Ability-to-Repay and mortgage servicing rules.

The Bureau recently published a new Regulatory Implementation web page, which consolidates all of the new 2013 mortgage rules and related implementation materials. The Regulatory Implementation web page can be found here:http://www.consumerfinance.gov/regulatory-implementation

A copy of today’s final rule can be found at: http://files.consumerfinance.gov/f/201307_cfpb_final-rule_titlexiv.pdf

 

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For more information about OnlineEd and continuing education for mortgage license renewal, please visit their website. For more information about OnlineEd’s CFPB compliance and education management systems, please visit the InlineEd website.

The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives. For more information, visit www.consumerfinance.gov.

Ten More States to Use Uniform Mortgage Test; 30 States Now Using the Test

(OnlineEd® – Portland, OR) The Conference of State Bank Supervisors (CSBS)  today announced that an additional 10 state mortgage loan originator licensing agencies will begin using the National SAFE MLO test. This brings the total number of state agencies to 30 who are using the test.  The test was first made available on April 1, 2013, and combines both the national and state testing requirements of the SAFE Act. Because the new test replaces the separate, state-specific test for the states who adopt it, it streamlines the process for mortgage originators who want to hold multiple state licenses.  Any mortgage loan originator who passes the test is compliant with the SAFE Act testing requirements in all thirty states. For a limited time, between April 1, 2013 and March 31, 2014, there is also the short version, stand-alone UST available for anyone who has previously passed the retired national test.

Twenty state agencies initially adopted the National SAFE MLO test in April, and an additional 10 state agencies will adopt it today.  These 10 state agencies are:

• The Alabama State Banking Department;
• The Alaska Division of Banking and Securities;
• The Indiana Office of Secretary of State;
• The Kansas Office of the State Bank Commissioner;
• The Montana Division of Banking and Financial Institutions;
• The Nebraska Department of Banking and Finance;
• The New Jersey Department of Banking and Insurance;
• The Tennessee Department of Financial Institutions;
• The Vermont Department of Financial Regulation; and
• The Wyoming Division of Banking.

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An additional five state agencies are scheduled to adopt the test by Jan. 2014.

More information on the National SAFE MLO test is available here.

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About CSBS:
The Conference of State Bank Supervisors (CSBS) is the nationwide organization of banking regulators from all 50 states, the District of Columbia, Guam, Puerto Rico, and the U.S. Virgin Islands.
About OnlineEd:
OnlineEd is a provider of mortgage and real estate broker pre-licensing and continuing education courses, as well as the developer of  InlineEd, an education and compliance management software for the mortgage industry.  For more information about OnlineEd please visit www.OnlineEd.com. For more information about InlineEd, please visit www.InlineEd.com.