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The Consumer Financial Protection Bureau released a guide to completing TILA-RESPA integrated mortgage disclosure forms.  The guide complements the recently released Small Entity Compliance Guide and highlights common situations that may arise when completing the forms. The TILA-RESPA disclosure changes take effect August 2015.  Find the guide on the CFPB’s website, at www.consumerfinance.gov

The Independent Community Banker Association September magazine publication had a great article titled “Fee or Free?”  Trent Fleming, a bank consultant stated “Community banks have given away so much for so long they’ve spoiled customers.”

This summer federal regulators issued for comment a plan that would establish standards for states to license and supervise appraisal management companies.  This plan was no surprise as most states were moving towards compliance with the Dodd-Frank Act which requires states to license AMC’s.  Of the 37 states that currently license AMC’s there does not seem to be any need for changing their requirements as all are within the guidelines of the regulatory plan. 

It is hoped that this will stimulate the remaining 13 states to set up their own licensing/oversight programs.  The new plan gives the states three years to set up the oversight program required by the Interim Final Rule of the Federal Reserve. 

The Consumer Financial Protection Bureau is in the complaint business, and business is good. The CFPB received 163,700 consumer complaints in 2013, nearly double the total 90,000 they received in 2012.

The CFPB’s Consumer Response Annual Report shows that the bulk of the complaints – a plurality of 37% – were related to mortgages.

Less time spent on appraisal mortgage compliance means more time with your customers

Worry list: CFPB compliance; USPAP/Appraisal Standard compliance; Inter Agency compliance; firewall between loan production staff and real estate appraiser; Fannie/Freddie cram downs; customary and reasonable fees; RESPA compliance; documented quality control/appraisal review; vendor maintenance; HELOC evaluations; and commercial appraisal order management/review.

Yes, it looks like the pendulum is swinging again, this time with changes that may allow more loan applicants to qualify for their mortgages.  A recent Consumer Financial Protection Bureau study found that some consumer’s credit ratings were being unfairly penalized for paid and unpaid medical debts.  As a result of this study, FICO, the most used credit-scoring system, announced they were changing some of their criteria.  This should allow some borrowers scores to change significantly over this next year. A borrower whose only major issue is an unpaid medical bill could see their score improve by 25 points. It will be a long process and will take time, so those borrowers should be patient before moving towards a purchase of a home. 

The housing market is showing mixed signals

in a report recently sent out by Freddie Mac.  The report showed that the low of the residential market was in November of 2010.  Today’s numbers still reflect a weak market, and that market has actually declined recently from April to May. 

What got my attention was when I saw only 13 states out of 50 (plus D.C.) are now in the stable category!

 The states ranking on top are:

• North Dakota
• Washington, D.C.
• Wyoming
• Alaska
• Montana

Eight of the 50 metro areas tracked also are in their stable range by historical standards. Ranking in the top five:

Across the country the foreclosure rate has fallen dramatically.  No state has had an increase in its foreclosure rate for the past two years.  This is probably due to the steady improvement in home prices, encouragement in the employment sector, and still great mortgage rates. 

But there has been a wide difference between the states, Florida, Illinois, Ohio, Kentucky, Indiana, and Wisconsin are all states that SAMCO has a significant number of clients and they all had, by comparison to other states, high foreclosure rates and a relatively weak recovery the past two years.  Arizona and California experienced the sharpest declines in their foreclosure rate. 

Fannie Mae is the leader for Appraisal Standards.  Freddie always follows suit and the Federal Home Loan Bank (FHLB) uses Fannie’s Standards.  So when Fannie changes an appraisal requirement the industry changes. 

On April 15, Fannie changed its Selling Guide to reflect changes in appraisal updates, photo’s and comparable sales.  Significant changes were also made to re-titling and reorganization of content that, hopefully, will make searching for specific information easier.

Some of the changes are:

The Consumer Financial Protection Bureau established a hotline for consumer complaints in 2012.  In 2013 they received 163,700 consumer complaints and mortgages made up 37 percent of those complaints.  Loan modifications, collections, and foreclosures made up most of those mortgage complaints.  When a consumer files a complaint, the CFPB tries to assist by helping borrowers.  THEY ARE NOT THERE for the lender!  Their mission is for the consumer.  The CFPB is just starting being an advocate for the consumer.  They will be advertising and promoting awareness  of being available for complaints, whether about an appraisal, closing issues, or misunderstandings.