July 17, 2019

In This Issue:

  • TDI Issues Annual Title Agent Data Call
  • Federal Reserve Responds to Wire Fraud Letter
  • Trump Team Wary of Fannie-Freddie Fix Before 2020 Election
  • Trade Groups Cast Doubt Over FHA's Attempt to Remove Lending Roadblocks

TDI Issues Annual Title Agent Data Call

Texas Department of Insurance | July 16, 2019
The Texas Department of Insurance has issued its call for agent statistical data. Texas Insurance Code §2703.153 requires each title insurance company and title insurance agent engaged in the business of title insurance in Texas to annually submit business data to TDI. TDI uses this data to set title insurance premium rates. This report should be completed with data generated during calendar year 2018.
You must respond to this data call using the provided instructions and forms no later than Aug. 27, 2019. 
If you are unable to download the forms or have questions about this data call, contact TDI's Joshua Fellers at 512.676.6687 or PCDataCallTitle@tdi.texas.gov.
The education department at TLTA is preparing a webinar to help guide you as you complete TDI's mandatory data report. 
If you have concerns or questions, please call us at 512.472.6593 or email tlta@tlta.com

Federal Reserve Responds to Wire Fraud Letter

James E. Hyland, TLTA Federal Legislative Counsel | July 15, 2019
On July 9, the Federal Reserve Board (FRB) responded to a letter from forty-three members of Congress asking the FRB to make combating wire fraud a higher priority. The letter to which FRB responded also suggested that the Fed look at the progress being made in the United Kingdom to address wire fraud and whether the United States can implement similar protocols such as effectively verifying the payee's name on a wire payment. 

The FRB’s response fell short of what our industry was seeking. They stated that "(payee matching) presents legal and operations challenges,” and the, "bank is permitted to rely on the number as proper identification." Their letter further stated that "to require otherwise would create significant operations obstacles to processing hundreds of thousands of wire payments that occur each day. The vast majority are processed by automated means."

The FRB wrote too that enhancing customer identification before opening an account is a means to counteract fraud. They also stated that the Federal Reserve is "engaged in efforts to reduce fraud more broadly in wire payments."

Read More »

Trump Team Wary of Fannie-Freddie Fix Before 2020 Election

Bloomberg | July 12, 2019
The Trump administration is growing wary of taking bold steps toward freeing Fannie Mae and Freddie Mac from federal control before the 2020 election, said people familiar with the matter, in part because of the political risk of potentially upending the U.S. mortgage market.

While White House and Treasury Department officials are eager to end the companies’ decade-long conservatorships, they see the task as arduous, slow-moving and extremely complicated, said the people who asked not to be named in discussing internal deliberations.

Adding to the challenge is that Treasury Secretary Steven Mnuchin is spending much of his time on more pressing priorities, including the trade war with China, debt ceiling negotiations with Congress and imposing sanctions on Iran and other nations. Still, Mnuchin, who has experience in the mortgage banking industry, works on housing finance weekly, according to one of the people.

“The president earlier this year instructed the Department of Treasury to develop a comprehensive plan for bold reform,” White House spokesman Judd Deere said in an email statement. The National Economic Council, Treasury, Federal Housing Finance Agency and others “continue to work together on this presidential priority and anything to suggest otherwise is false,” Deere said.

Fannie slid as much as 11% before rebounding to $2.70, a 4.2% decline, at 1:38 p.m. in New York. Freddie fell as much as 10% and stood at $2.61, down 3.3%. The declines were the biggest since Mnuchin told Bloomberg in June that he didn’t want to release the companies from government control without reform.
Read More »

Trade Groups Cast Doubt Over FHA's Attempt to Remove Lending Roadblocks

HousingWire | July 15, 2019
In recent years, lenders have shied away from the Federal Housing Administration’s mortgage program out of fear that minor infractions could lead to major consequences labeled a violation of the False Claims Act.

Indeed, a number of lenders were aggressively penalized under Obama-era policies that imposed harsh fines for those who committed even minor errors that were deemed a violation.

As a result, banks have largely left the business, with the FHA stating that they are responsible for just 13% of recent FHA loan volume, down from 44% in 2010.

But the new administration has expressed its intent to change the old enforcement policies, announcing in May that it was working to clarify the rules of its mortgage program in an effort to ease compliance concerns.

“We are looking to bring clarity to our compliance rules that continue to discourage many lenders – including banks – from doing business with FHA,” FHA Commissioner Brian Montgomery said at the time. “We’re hoping to be more transparent in how we do business with lenders by letting them know what the potential remedies are for mistakes or errors they may make in the origination and servicing of FHA loans.”
To provide that clarity, Montgomery said the agency is aiming to replace the “jumbled legalese” in its certification and compliance documents with “plain English,” publishing a rule-change proposal and soliciting industry feedback.

But it seems some are skeptical about the FHA’s proposed steps, as a number of trade groups expressed their joint belief that the changes do not go far enough to ease compliance concerns and will therefore not encourage more lender participation.

In two letters sent recently to the Department of Housing and Urban Development with feedback on the matter, four trade groups – the Housing Policy Council, the Mortgage Bankers Association, the American Bankers Association and the Bank Policy Institute – cast doubt on the proposed revisions to the FHA’s lender guidelines.
Read More »

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