Compliance & Regulation

A fight is brewing between regulators and Congress over how to develop a covered bond market, with the latest salvo expected to be fired as soon as Tuesday, when the House Financial Services Committee could begin voting on a bill tackling the issue.

House and Senate committees have approved Department of Housing and Urban Development appropriation bills that extend the $729,750 loan limit through September 2011.

Credit union leaders told Credit Union Journal they fear already burdensome regulatory and compliance demands will become overwhelming in the next few years, and will only add new expenses at the same time interchange income is declining.

National volunteer programs and state government entities are busy working to unearth and close down "unscrupulous and unlicensed loan modification companies" who prey on financially stressed homeowners.

For example, NeighborWorks organizations around the country held more than 150 events during National NeighborWorks Week June 5-12 to inform tens of thousands of homeowners on how to avoid and report mortgage modification scams.

Congress has extended the Protecting Tenants at Foreclosure Act through 2014 as part of the Dodd-Frank Wall Street Reform bill that President Obama signed this week.

The Federal Housing Administration's legislative and regulatory agenda to bolster its depleted insurance fund and tighten underwriting standards continues to be a work in progress.

Back in January, FHA commissioner David Stevens began talking about a legislative proposal to give the agency more flexibility in setting premiums, including a hike in annual charges.

The House eventually passed a bill, allowing the FHA to adjust its premium structure but Senate action is still in doubt.

Regulatory changes continue to be what largely drives automation for those on the production side, especially when it comes to the documentation necessary, according to executives at DocMagic Inc., Carson, Calif., which does business as Document Systems Inc.

Only a few hours after regulatory reform was signed into law Wednesday, Federal Reserve Board Chairman Ben Bernanke assured lawmakers the central bank was well along toward implementing many of its biggest provisions.

Mortgage fraud, recognized as an impediment to lender-servicer efforts to maximize portfolio recovery, is on the rise and expected to get worse, especially in property valuations.

Property preservation company Mortgage Contracting Services is currently tracking over 500 enacted code compliance related ordinances and disaster notifications.

These ordinances consist of city and state ordinances, including vacant property registration as well as FEMA disaster notifications.

One state law to note is the Colorado "fast track" foreclosure bill, which expedites the foreclosure process on vacant, abandoned properties.