July 12, 2017


CFPB News: CFPB Releases Changes to TRID

Consumer Financial Protection Bureau | July 10, 2017
As we reported in TLTA's Breaking News alert on Monday, June 10, the CFPB released updated changes to the TRID rule late on Friday, June 7. This rule has been in the process of being updated since July 2016, when CFPB first issued this rule for comment. TLTA commented on CFPB's proposals at the time, noting that the bureau did not address the simultaneous issue problem. The agency received more than 1,600 comments, and the resulting new changes are over 560 pages long. The effective date for mandatory compliance will be Oct. 1, 2018, but the new rules will technically be effective 60 days after publication in the Federal Register, which will come within a few weeks.
The changes specifically relate to the practical implementation of TRID. When the rulemaking changes were released last July, the bureau did not reopen any major policy decisions. It stated when releasing the final proposal that it was "prioritizing its resources to further facilitate industry's implementation progress. This final rule does not contain any revisions that implicate fundamental policy choices, such as the disclosure of simultaneous issuance title insurance premiums made in the TILA-RESPA Final Rule. This final rule also does not include additional cure provisions." We are disappointed with the CFPB's decision not make changes to the simultaneous issue concern, but not surprised because they openly stated they would not. We think possible changes could come when a new director of the CFPB comes into office and takes a fresh look at the issue, but nothing is guaranteed. CFPB director Richard Cordray's term will end in July 2018.
In an ALTA Advocacy Update, ALTA CEO Michelle Korsmo noted, "On sharing the Closing Disclosure, there is extensive discussion of the comments and the interplay between Gramm-Leach-Bliley Act (GLBA) and state law. The rule does not go so far as to mandate sharing. Instead, it states, 'the Bureau notes that such sharing of the Closing Disclosure may be permissible currently to the extent that it is consistent with GLBA and Regulation P and is not barred by applicable State law. However, the Bureau does not believe that expansion of the scope of such permissible sharing would, in this rulemaking, be germane to the purposes of Regulation Z.'"
Read the TLTA Breaking News Alert »
Read the CFPB Press Release »
Read the CFPB Executive Summary »
Read the Final Rule Amendments »

Fraud Alert: Remind Customers to Watch Out for Mortgage Closing Scams

Consumer Financial Protection Bureau | July 7, 2017
Summer is a busy homebuying season. Unfortunately, that means title insurance professionals and their customers need to watch out for email phishing scams.
According to reports, one of the current scams targets homebuyers who are nearing the closing date on their mortgage loan. The scammers attempt to steal the homebuyer’s closing funds – for example, their down payment and closing costs – by sending the homebuyer an email posing as the homebuyer’s real estate agent or settlement agent (title company, escrow officer or attorney). The email falsely claims there has been a last-minute change in the closing process – for example, claiming that a check is no longer acceptable or that the wiring instructions have changed. It instructs the homebuyer to wire or otherwise electronically transmit the closing funds to an account that the scammers control.
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Fraud News: Mortgage Risk Hits Highest Level in Two Years

HousingWire | July 3, 2017
The frequency of defects, fraudulence and misrepresentation in the information submitted in mortgage loan applications increased in May to levels not seen since 2015, according to First American Financial Corp., a provider of title insurance, settlement services and risk solutions for real estate transactions.
This frequency increased 2.5 percent in May, according to the Application Defect Index. This is an increase of 13.7 percent from the year before.
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GSE News: Two Major Lending Changes Mean It's Suddenly Easier to Get a Mortgage; Fed Says Current Housing Finance System "Unsustainable"

The nation's three major credit rating agencies, Equifax, TransUnion and Experian, will drop tax liens and civil judgments from some consumers' profiles if the information isn't complete. Also, mortgage giants Fannie Mae and Freddie Mac are allowing borrowers to have higher levels of debt and still qualify for a home loan. These changes come at a time when lenders are competing for a shrinking market of borrowers.
Read "Two Major Lending Changes Mean It's Suddenly Easier to Get a Mortgage" (CNBC) »
In addition, Federal Reserve Governor Jerome Powell recently said that the U.S. housing finance system continues to put taxpayers at risk in a market dominated by government-backed agencies, calling for further reform of an "unsustainable" situation. A decade after doubts about the creditworthiness of mortgage-backed securities helped trigger the worst financial crisis since the Great Depression, systemic risk remains given the concentration of mortgages in Fannie Mae and Freddie Mac, he said.
Read "Fed's Powell Says Current US Housing Finance System 'Unsustainable'" (CNBC) »

CFPB Reform News: Battle Brews Between U.S. Credit Union, CFPB

Reuters | July 6, 2017
A U.S. financial regulator on Thursday, July 6, criticized the CFPB for how it polices credit unions in a sign of growing tensions between regulators appointed by Trump and holdovers from the Obama administration.
Republicans have been critical of the CFPB, saying it is too unaccountable to Congress because its budget is not appropriated and it is governed by a single director. The Trump administration has called for reforms to the CFPB, but has been silent on whether it intends to try to have CFPB director Richard Cordray removed before his term expires next summer.
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