TRID Problems Led to W.J. Bradley's Demise

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W.J. Bradley Mortgage Capital shut its doors after it was stuck with nonagency loans with TILA/RESPA integrated disclosure issues that it couldn't sell.

Without specifying the Centennial, Colo.-based lender by name, David Stevens, president and CEO of the Mortgage Bankers Association, said uncertainty about how regulators will police the new borrower disclosures that took effect in October is creating friction between originators and investors.

"One of the recent announcements of a large mortgage lender that shut their doors in the last several days, I quite frankly believe it has a lot to with this, [is] the loss over a cap line with an investor. They were rejected on the nonagency side," Stevens said Wednesday during a speech at the Regional Conference of MBAs, ongoing this week in Atlantic City, N.J.

W.J. Bradley was one of the first lenders to roll out a non-qualified mortgage loan program. But it lost its warehouse funding because it had jumbo mortgages stuck on its line of credit with TRID issues, according to a former employee of the company who spoke to NMN on condition of anonymity.

Previous attempts to contact the company were not successful and a new attempt to contact W.J. Bradley for further comment has not been returned.

A memo obtained by National Mortgage News sent by W.J. Bradley to its employees on March 13 only states the company made "a strategic decision to wind down their businesses." It did not specify why.

Before the TRID rules took effect, lenders and compliance experts expressed concerns about the salability of mortgages with TRID defects. W.J. Bradley is the third retail lender to stop originating loans in recent weeks, joining Walter Investment Management's Ditech Financial subsidiary and the $24 billion-asset BankUnited in Miami Lakes, Fla. However, Ditech and BankUnited remain in the origination business through other channels.

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Compliance Qualified Mortgages Secondary market Risk management Jumbo mortgages Originations