Compliance & Regulation

Sen. Rand Paul, the newly installed 'Tea Party' senator from Kentucky, wants to eliminate the Department of Housing and Urban Development, saying the agency played a key role in the housing crisis by implementing policies that "expanded risky mortgages," including subprime loans.

The mortgage crisis points to the need for leveling the playing field between banks and nonbank providers for consumer lending. The lack of sensible, consistent mortgage lending standards and consumer protections in the run-up to the crisis ended up destabilizing housing markets and the entire financial system.

The Federal Reserve Wednesday afternoon issued long awaited written guidance to help small businesses — including loan brokers — comply with its loan officer compensation rule that goes into effect April 1.

Certain states — including California and Virginia — are contemplating changing their real estate laws to require any mortgage firm pursuing a foreclosure to recreate all the transfers and assignments of a loan, according to real estate attorneys.

New York Life Insurance Co., TIAA-CREF, the French bank Dexia and other institutional investors joined the list of bondholders seeking compensation from Bank of America Corp. over MBS losses they suffered from buying nonprime bonds from Countrywide Financial Corp.

On January 19, Colorado had 3,614 licensed and approved loan officers, a 25% decline from just two weeks earlier, a sign that new licensing and testing requirements are weeding out professionals in the industry.

The Treasury Department on Monday confirmed what most mortgage lobbyists have been anticipating for months — that the White House's long-awaited report on restructuring Fannie Mae and Freddie Mac (and the U.S. housing finance system in general) will be delayed until mid-February.

Investors, as well as issuers of mortgage-backed securities with government guarantees, should take a hit if the underlying loans go bad, according to former GSE regulator James Lockhart.

An ever-changing regulatory environment is challenging everyone from servicers to foreclosure attorneys and their clients creating demand for simple services that may go a long way in benefiting all parties involved in the mortgage chain.

Software solutions provider MortgageFlex Systems Inc., Jacksonville, Fla., has entered into a partnership with Interthinx of Agoura Hills, Calif., in an effort to integrate within the same platform complementary tools that combine fraud prevention with predatory lending management.