The Federal Reserve Board is prepared to examine nonbank subsidiaries of bank holding companies in certain cases where Home Mortgage Disclosure Act data point to possible fair lending violations, according to a Fed official.Although the Fed regulates BHCs, it rarely examines the mortgage banking and consumer finance subsidiaries of holding companies. The Federal Trade Commission has enforcement powers over those entities. But a Federal Reserve Board policy allows for exceptions under special circumstances, according to Fed special counsel Robert Cook. In cases where the HMDA data are "fairly definitive," Mr. Cook said, Fed examiners would approach an institution to seek more information about the disparities that showed up in the subprime loan pricing data. "We would ask what they have done about it and then work out something on whether they will share it with us," Mr. Cook told MortgageWire. In severe cases, "they could go in and do an exam," he said. The Fed special counsel indicated that Fed examiners have approached four or five BHC subsidiaries where the pricing data have raised concerns about disparate treatment of minority borrowers. The Fed can be found on the Web at http://www.federalreserve.gov.
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Ohio-based Liberty Home Mortgage joins several companies who started using a more modernized FICO credit score for nonconforming mortgage originations recently.
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The CFPB has dissolved the Office of Supervision, Enforcement and Fair Lending and eliminated the job of associate director in a move that impacts how it designates nonbanks for supervision.
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The plan that the Federal Housing Finance Agency floated calls for Freddie Mac to actively invest in some new closed-end seconds as cash-out refinancing subsides.
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The push comes amid what one expert highlighted as lax funding efforts for two Department of Housing and Urban Development grant programs.
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Conventional lending drove volumes higher, particularly in the purchase market, the Mortgage Bankers Association said.
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Net charge-offs at the Charlotte, North Carolina-based bank increased by more than 80% in the first quarter compared with a year earlier. BofA executives say that the rising losses were in line with the bank's risk appetite.
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