Compliance & Regulation

Ari Karen, a partner at the Maple Lawn, Md.-based Offit Kurman who represents financial institutions in labor and employment matters, has written an opinion piece on loan officer compensation issues.

The House of Representatives quickly passed a slimmed-down FHA reform bill Friday that appears to be an attempt to make it easier for the Senate to pass legislation before the August recess.

Senate Banking Committee Chairman Chris Dodd and Sen. Richard Shelby, the panel's senior Republican, called on President Obama Thursday to appoint a permanent director for the Federal Housing Finance Agency.

A coalition of real estate and consumer groups is pressing federal regulators to ban the use of "private transfer fees" that require home sellers to pay a percentage of the sales price to third parties.

As loan officers who don't meet the requirements drop out of the industry, the result could be a shortage of people to take applications -- at a time when demand for refinancings is historically high.

A high ranking Democrat on the House Financial Services Committee wants to explore ways of recouping the cost of placing the government-sponsored enterprises into conservatorships.

Thanks to the Dodd-Frank Wall Street Reform and Consumer Protection Acts, the federal government is making it virtually impossible to be a mortgage broker. By extending the application of the Truth in Lending Act to include mortgage brokers (formerly limited to "creditors") and clearly defining, and otherwise limiting, how brokers can be compensated (YSP is dead), the act is forcing brokers to rethink the way that they do business.

Loan officers at banks, thrifts, and credit unions must sign up with a nationwide registry starting next year under final rules issued by federal regulators on Wednesday.

Fraudsters in today's mortgage market are "quite entrepreneurial," coming up with new ways to scheme against borrowers, according to speakers at the SourceMedia Second Annual Best Practices in Loss Mitigation Conference in Dallas.The beginning of foreclosure rescue fraud starts typically when a servicer publishes a public notice concerning the homeowner. In a modification scheme, they offer a "modification for money and they never deliver."

Thanks to the Dodd-Frank Wall Street Reform and Consumer Protection Acts, the federal government is making it virtually impossible to be a mortgage broker. By extending the application of the Truth in Lending Act to include mortgage brokers (formerly limited to "creditors") and clearly defining, and otherwise limiting, how brokers can be compensated (YSP is dead), the act is forcing brokers to rethink the way that they do business. For mortgage brokers to survive, they need access to wholesale lenders and must establish relationships with select retail lenders. For lenders to survive, they need to meet strict quality and delivery guidelines that insulate mortgage securitization issuers from the act's risk retention requirements. These guidelines include, but are not limited to, increased underwriting obligations, changes to the HOEPA thresholds, additional disclosure requirements and asset verification and validation requirements. These strict quality guidelines are necessary to insure that the assets that are purchased by mortgage securitization issuers adhere to the risk retention safe harbor requirements, and in return, the issuer can confidently provide liquidity to the lender, that is necessary to keep funding loans that the brokers are selling.