News By Edition

Marx Sterbcow, managing attorney at Sterbcow Law Group, and Justin Wiseman, associate vice president of the Mortgage Bankers Association (MBA) took part in a regulatory panel June 6 at the National Settlement Services Summit (NS3).

The session was moderated by Chuck Cain, EVP Agency of WFG National Title Insurance Co., who asked the panelists what the future held in store for the Consumer Financial Protection Bureau (CFPB).

Read on to learn what the panelists had to say about enforcement trends and other topics.

Facebook has responded to the U.S. Department of Housing and Urban Development’s (HUD) allegations that it violated the Fair Housing Act (FHA) by allowing landlords and home sellers to use its advertising platform to engage in housing discrimination.

HUD claims Facebook enables advertisers to control which users receive housing-related ads based upon the recipient's race, color, religion, sex, familial status, national origin, disability and/or ZIP code.

Read on to see the social networking website’s response to the complaint.

Under the Donald Trump administration, the Consumer Financial Protection Bureau (CFPB) has left much of the enforcement activities in the real estate industry up to the states. And money laundering in the form of terrorist financing remains a problem, experts said.

Legal experts at K&L Gates spoke about the latest enforcement risks at RESPRO’s spring session.

Read on to learn what they had to say about coming storms in light of the CFPB rollback.

The Senate Banking Committee on Aug. 23 approved the nomination of Kathy Kraninger to head the Consumer Financial Protection Bureau (CFPB) for a five-year term.

Members voted 13-12 in favor along party lines. The nomination now will go before the full Senate for consideration.

Read on for highlights of the committee hearing and reaction on the vote from the Consumer Bankers Association (CBA) and the American Bankers Association (ABA).

The California Supreme Court has unanimously ruled the state can enforce against interest rates that are too high on loans that are above the current statutory standard.

A class action lawsuit was filed in the federal district court for the Northern District of California against lender CashCall, Inc., on behalf of borrowers who took out loans of at least $2,500 at an interest rate of 90 percent or higher.

Read on for details of the Supreme Court’s opinion.

A woman who signed an interspousal transfer deed was still recognized as an obligor to the loan by her servicer months later, allegedly causing her to be denied a home mortgage loan.

The woman sued for RESPA violations, and a California district court ruled that the woman was able to state a claim against the servicer for violating RESPA by erroneously reporting the woman still was responsible for the mortgage she had with her ex-husband.

Read on for highlights of the court decision.

No more regulation by enforcement.

That was the loud and clear message sent to the Consumer Financial Protection Bureau (CFPB) from many of the 487 people who responded to a request for information (RFI) about the bureau’s enforcement processes.

Read on for highlights of comments from RESPRO, the American Bankers Association (ABA) and others who addressed problems with consent orders, civil money penalties, NORA letters and other enforcement issues.

The Third Circuit Court of Appeals has upheld the Consumer Financial Protection Bureau’s (CFPB) right to issue a civil investigative demand (CID) to a student loan servicer.

The bureau filed a petition in 2017 to enforce a CID to Heartland Campus Solutions, ECSI, in a Pennsylvania federal court.

Read on for highlights of the higher court’s opinion, which found the CFPB complied with the statute that authorizes the bureau to enforce CIDs.

Two mortgage servicers may have violated RESPA by failing to provide a full accounting and explaining extra charges and fees to a Texas couple whose property flooded during Hurricane Harvey.

The plaintiffs also may have suffered actual damages resulting from the servicers’ failure to respond to a quailed written request, a federal magistrate judge ruled recently.

Read on for more details from the district court case.

The National Credit Union Administration (NCUA) has selected a new director for the Office of Consumer Financial Protection (OCFP) in the NCUA headquarters.

Matthew Biliouris, who has been serving as the agency’s acting director and previously served as the office’s deputy director, now will lead the OCFP.

Read on to learn more about Bilouris, who began his career with the NCUA in 1992 as an examiner.

The Consumer Financial Protection Bureau (CFPB) has finalized amendments to implement 2015 legislation that allows financial institutions that meet certain requirements to be exempt from sending annual privacy notices to their customers.

The Gramm-Leach-Bliley Act (GLBA) generally requires that financial institutions send annual privacy notices to customers and include whether and how they share customers’ nonpublic personal information.

Read on for more details about the finalized amendments.

The Federal Housing Administration (FHA) is offering new foreclosure prevention options to residents of Puerto Rico and the U.S. Virgin Islands who are struggling in the aftermath of Hurricanes Irma and Maria.

The options will allow those with delinquent FHA-insured mortgages easier access to bring their mortgages current without increasing their interest rates or monthly payments.

Read on for more details on the FHA’s plan to help reduce foreclosures while minimizing losses to the Insurance Fund.

With today’s focus on regulating compliance, data protection never has been more important.

Legal experts Ashoo Sharma, Christian Kelly and Ed Kaiser shared the spotlight at RESPRO’s spring session called, “Your agent and consumer data: Should it benefit you and your affiliates or outside interlopers?”

Read on to hear the speakers’ analysis on how you can use behavioral data to grow your business while building trust with your data partners.

The Consumer Financial Protection Bureau (CFPB) has denied Firstsource’s motion to set aside a civil investigative demand (CID) over its debt collection practices.

The action marked the first time there has been any movement on CID petitions under acting CFPB director Mick Mulvaney.

Read on for more details on Mulvaney’s decision, which also granted the company’s request for confidential treatment of certain materials.

The U.S. Department of Housing and Urban Development (HUD) is changing its Affirmatively Furthering Fair Housing (AFFA) regulations, and needs your help.

HUD is asking for public comment on changes to its AFFA regulations, which were finalized in 2015. 

Read on to find out why HUD believes the rule needs changed, and what specific feedback officials are looking for on the advanced notice of proposed rulemaking.

A borrower who received notice of a loan modification denial more than a year after applying – and after her house had been sold at a foreclosure sale – appealed a district court ruling that rejected her RESPA claim against the servicer.

The Eleventh Circuit Court of Appeals overturned the district ruling, saying the borrower alleged “sufficient facts to state a plausible violation of RESPA and Regulation X.”

Read on for highlights of the panel’s opinion, which cited commentary from the Consumer Financial Protection Bureau (CFPB).

The Consumer Financial Protection Bureau (CFPB) has a new resource to test whether an HMDA file meets formatting requirements specified in the HMDA Filing Instructions Guide (FIG).

The File Format Verification Tool (FFVT) was developed for HMDA data collected in 2018 and submitted in 2019. It has no login functions, and does not log identifying information about FFVT users or the files they upload.

Read on for more details.

The Consumer Financial Protection Bureau (CFPB) received 8,023 public comments on its request for information about the bureau’s civil investigative demands (CIDs).

The bureau issued a Request for Information (RFI) Jan. 17 seeking information from interested parties to consider whether any changes to CIDs would be appropriate.

Read on to learn what RESPRO, the National Association of Realtors (NAR), the Mortgage Bankers Association (MBA) and others had to say about the process.

The Consumer Financial Protection Bureau (CFPB) has collaborated with 11 other agencies to allow firms to easily interact with regulators around the world.

The Global Financial Innovation Network (GFIN) will help firms navigate between countries as they look to scale new ideas. It will also create a new framework for cooperation between financial services regulators on innovation-related topics.

Read on for more details on the GFIN’s mission.

Regulatory reform is needed to promote more efficient real estate transactions in a post-crisis regulatory environment, according to a new report from the U.S. Department of Treasury.

The report focuses on nonbank financials, fintech and innovation, and details several trends that arose following the housing crisis.

Read on to learn what the National Association of Realtors (NAR) has to say about the Treasury’s report.

A borrower who was unemployed and did not have phone service sued his servicer for RESPA violations, stating the servicer did not respond to his concerns except in form letters, limiting communication to telephone, even though they knew he lacked telephone service.

The Pennsylvania district court judge determined that there was nothing in Regulation X which required a servicer to respond in writing when a borrower lacks access to telephone service.

Read on for more, including an examination of the borrower’s claims for actual damages.

Due to a legal void, hundreds of lawsuits in 24 states have been filed against banks, credit unions and other companies accused of discriminating against people with vision or hearing disabilities related to website compliance.

Now, attorneys generals in 18 states are asking U.S. Attorney General Jeff Sessions for help in getting the Justice Department to provide clear guidance to the public and regulated entities on website accessibility standards under the Americans with Disabilities Act.

Read on for more details from their request.

Citigroup has been fined $8.6 million by the Federal Reserve Board for engaging in unsafe banking practices by improperly executing residential mortgage documents.

The penalty addresses the deficient execution and notarization of certain mortgage-related affidavits prepared by a non-bank subsidiary. The Federal Reserve Board also announced the recent termination of a 2011 separate enforcement action against Citigroup and CitiFinancial related to residential mortgage loan servicing.

Read on for details from the court order.

The entire real estate industry will be closely watching the November midterm elections.

Lindsey Johnson, president of U.S. Mortgage Insurers (USMI) spoke in April at RESPRO’s opening spring general session on what changes November could bring to housing finance reform. 

Read on to see what Johnson, RESPRO and ALTA had to say about what role politics is likely to play in the secondary mortgage market and on regulatory issues.

A federal judge in Montana is the latest to rule that the structure of the Consumer Financial Protection Bureau is constitutional.

U.S. District Judge Brian Morris’s Aug. 3 opinion denied a motion to dismiss by Think Finance, a debt collector that was sued by the CFPB in 2017 for allegedly violating the Consumer Financial Protection Act (CFPA).

Read on for highlights of the judge’s opinion, which cited previous case law across the country and noted the administration’s “shifting position on this issue.”

The Financial Crimes Enforcement Network (FinCEN) has extended regulatory relief for its new Customer Due Diligence rule regarding certificate of deposit (CD) or loan accounts for another 30 days to further consider the issue.

The rule had been scheduled to expire Aug. 9, and has been extended up to and including Sept. 8.

FinCEN previously issued an administrative ruling providing 90 days of limited exceptive relief for CD or loan accounts. Read on for more details.

The House Financial Services Committee recently advanced two bills slated to improve access to real estate settlement services and products.

Committee members voted 34-22 to send H.R. 2570, the Mortgage Fairness Act of 2017, to the full House after a July 24 markup session involving seven pieces of legislation. H.R. 2570 amends TILA to clarify that the points and fees relating to a mortgage loan do not include certain compensation amounts already taken into account in setting the interest rate on the loan.

Read on for Rep. Maxine Waters’ reaction to the committee’s votes on that bill and others up for further consideration.

Wells Fargo did not improperly handle a New Jersey man’s loan modification request because bank officials were not “servicers” under RESPA at the time the documents were mailed, a federal judge has ruled.

The plaintiffs also claimed the defendants failed to respond to multiple Notices of Error (NOEs).

Read on for the judge’s reasoning on why the case was dismissed in light of New Jersey law.

The Consumer Financial Protection Bureau (CFPB) has failed to prove its claims that consumers were harmed by a Cleveland-based debt collector’s practice of identifying itself as a law firm in demand letters, a federal judge ruled recently.

The CFPB initiated a Civil Investigative Demand (CID) process against Weltman, Weinberg & Reis Co., LPA in September 2014. The bureau filed a lawsuit in April 2017 after the firm refused to sign a consent order.

Read on for highlights of the judge’s decision.

The spotlight on state regulators is brighter than in the past with the Consumer Financial Protection Bureau (CFPB) electing to focus more energy on functions other than enforcement under Mick Mulvaney’s leadership.

Richard Horn, principal attorney at Garris Horn PLLC and former senior attorney at the CFPB and the Federal Deposit Insurance Corp., shared the spotlight at the 2018 National Settlement Services Summit with two state regulators – John Lartz from Illinois and Chuck Myers from Virginia – as well as Michelle Korsmo, CEO of the American Land Title Association, to examine their approaches to the new regulatory environment, and taking an active role in shaping it.

Find out what matters the speakers explored in-depth during the session.

The Consumer Financial Protection Bureau (CFPB) received 152 public comments on its proposal to consider changes to the bureau’s rulemaking processes.

The bureau issued a Request for Information (RFI) March 7 to help assess the overall efficiency and effectiveness of its rules.

Read on to see suggestions from RESPRO, the MBA, U.S. Senators and NAR on how to avoid another TRID.

A federal judge in Louisiana has dismissed a lawsuit alleging a loan servicing company violated RESPA by not responding to a couple’s Qualified Written Requests (QWRs) seeking insurance proceeds to repair a hurricane-damaged home.

The plaintiffs claimed Select Portfolio Servicing, Inc. also violated RESPA by maintaining an excessive balance in their escrow account, instead of disbursing insurance proceeds which would have allowed them to repair the property  damaged by Hurricane Isaac.

Read on to learn why the case was dismissed.

The National Flood Insurance Program (NFIP) has been extended through Nov. 30, averting a possible lapse in coverage for millions of Americans at peak hurricane season.

However, National Association of Realtors  President Elizabeth Mendenhall said there is still more work to be done to ensure people in more than 20,000 communities nationwide who depend on the NFIP are not put at risk for a lapse in flood insurance.

Read on for more details.

The U.S. Department of Housing and Urban Development has approved voluntary compliance/conciliation agreements with housing providers in California, Idaho and Hawaii that were accused of denying reasonable accommodations for people with disabilities.

The housing providers failed to allow tenants to have assistance animals and denied a request to move to a ground-floor unit due to mobility issues.

Read on for more details.

Butler Snow is pleased to announce that four attorneys received recognition in the 2018 edition of Chambers High Net Worth (HNW), a publication which is specifically aimed at the private wealth market. The publication also recognized Butler Snow in its firm rankings.

Butler Snow is pleased to announce that David G. Mayhan and Sarah Smyth O’Brien have joined the firm’s Denver office. Mayhan and O’Brien will both practice with the firm’s tort, transportation and specialized litigation group.

The Stonehill Group, a veteran-owned, nationwide provider of quality control, due diligence and mortgage fulfillment solutions for the mortgage industry, announced that Patrick Gluesing will join the company as president and chief operating officer. Gluesing will oversee the strategic growth of the company as well as its day-to-day operations. David Green, who founded The StoneHill Group in 1996 and served as president and CEO, will remain as Chairman/CEO focusing on strategic initiatives, customer relations and marketing.

It’s been one month since the U.S. Supreme Court ruled in the Lucia v. SEC case that administrative law judges (ALJs) used by the Securities and Exchange Commission (SEC) were appointed improperly.

That led to President Donald Trump’s recent executive order excepting ALJs from the competitive service, which has industry experts wondering whether the Consumer Financial Protection Bureau’s (CFPB) ALJs are the next to be found unconstitutional.

Read on to see what Jennifer Mascott, assistant law professor at Antonin Scalia Law School, and Tom Sporkin, partner at Buckley Sandler LLP, told RESPA News.

Wells Fargo Bank may have violated RESPA by failing to evaluate a California couple’s loan modification request within 30 days.

In addition, the couple may have suffered actual damages because of their alleged emotional distress from their four-year battle to obtain a fair review for modification of their West Covina property, a federal judge ruled recently.

Read on for more highlights from the opinion, including why Wells had to comply with Regulation X on a second completed modification application.

The mortgage industry is facing slow growth, increasing costs to originate a loan and compressed profit margins, according to the latest edition of Stratmor Group’s Stratmor Insights report.

Can new Blockchain technology turn things around by providing mortgage lenders an opportunity to improve data security, operational efficiencies and origination turn-times?

Read on to learn what Stratmor principal Andrew Weiss has to say about Blockchain’s potential.

A consumer advocacy group has filed a Freedom of Information Act (FOIA) lawsuit against the Consumer Financial Protection Bureau (CFPB) to get information on CFPB director nominee Kathy Kraninger.

Allied Progress, represented by American Oversight, also named the Office of Management and Budget (OMB) in the suit.

Read on to find out exactly what type of records the group is seeking. 

SunTrust Mortgage did not violate RESPA when servicing a Pennsylvania woman’s attempts to obtain a loan modification or an extended forbearance agreement because the plaintiff did not prove damages after the company allegedly failed to respond to a qualified written request.

For the second time in two years, a federal judge has dismissed Jackie Stefanowicz’s claims. She originally filed pro se TILA and RESPA claims in U.S. District Court in 2016 claiming the company failed to return her phone calls or provide her with requested forms.

Read on for highlights of Magistrate Judge Martin C. Carlson’s opinion.

The Consumer Financial Protection Bureau (CFPB) received 33 public comments from legal experts, financial professionals and consumer advocacy groups on its proposal to amend the bureau’s Rules of Practice for Adjudication Proceedings.

The bureau issued a Request for Information (RFI) Jan. 31 seeking to better understand the benefits and impacts of its use of administrative adjudications, and how its existing process can be improved.

Read on to find out what RESPRO and others say about which rules should be amended.

The Consumer Financial Protection Bureau (CFPB) has settled with a small-dollar lender that violated the disclosure requirements of TILA by failing to properly disclose finance charges associated with auto title loans in Mississippi.

Triton Management Group was given a $1.5 million judgment, which represents the undisclosed finance charges consumers paid on their Triton loans.

But will the company have to pay the full amount of consumer redress? Read on to find out.

The House of Representatives voted July 25 to extend the National Flood Insurance Program for four months through Nov. 30.

The bill passed the House by a vote of 366-52.

Now, the National Association of Realtors (NAR) and other trade groups are urging the Senate to take swift action to enact a long-term reauthorization before the program expires July 31. Read on for more details.

The decision in PHH Corp.’s case against the Consumer Financial Protection Bureau (CFPB) played a major role in a federal appellate court’s recent opinion declaring the structure of the Federal Housing Finance Agency (FHFA) to be unconstitutional.

The Fifth Circuit Court of Appeals’ FHFA ruling was the second time in a month that a federal regulatory body was deemed unconstitutional.

Read on to find out what the majority panel found in Collins v. FHA.

Attorney General Jeff Sessions has rescinded two guidance documents directly related to home mortgages and another that addresses potential fair housing and lending violations.

Twenty-four guidance documents from prior administrations were found to be “unnecessary, outdated, inconsistent with existing law, or otherwise improper,” according to a Department of Justice (DOJ) news release.

Read on for more details and the implications of the decision from the attorney general.

Kathy Kraninger’s role in the Trump administration’s Zero Tolerance Policy on immigration and the administration’s response to Hurricane Maria in Puerto Rico took center stage July 19 at the Senate Banking Committee’s nomination hearing to consider Kraninger as the next director of the Consumer Financial Protection Bureau (CFPB). 

Kraninger and the White House have not responded to 12 Democratic committee members’ previous requests for documents about her current experience as the Office of Management and Budget’s (OMB) associate director, prompting them to request the hearing be delayed.

Read on for highlights of Kraninger’s discussions with senators at the nomination hearing.

RoundPoint Mortgage Servicing Corp. did not violate RESPA’s requirement that a loan servicer send verification of ownership or proper payment documents to a Texas woman who sought to have a lien declared void and unenforceable, a federal judge ruled recently.

Nathalie Sims filed suit in U.S. District Court in 2016 after Roundpoint began the foreclosure process on her property by sending her a notice of default and intent to accelerate. Sims claimed that she was forced into Chapter 13 bankruptcy as a result of the foreclosure order.

Read on for more details.

A high-ranking member of the Arizona Attorney General will lead the Consumer Financial Protection Bureau’s (CFPB) new Office of Innovation.

Paul Watkins, who was in charge of the Attorney General’s fintech initiatives, was chosen by acting CFPB director Mick Mulvaney.

Read on to find out more about Mulvaney’s plans for the new office, which will replace the bureau’s previous work being done under Project Catalyst.

An Alabama public housing board accused of disability discrimination has entered into a voluntary compliance/conciliation agreement with the U.S. Department of Housing and Urban Development (HUD).

The case began when a woman with disabilities filed a complaint with HUD alleging the Mobile Housing Board denied her request for a Housing Choice Voucher.

Read on to find out how the board agreed to resolve the claims.