Consumer Financial Services Law Blog
Dykema Gossett PLLC
Dykema Gossett PLLC

Consumer Financial Services Law Blog

Consumer Financial Services Law Blog

News and analysis regarding Consumer Financial Services litigation and regulation, and activities of the Consumer Financial Protection Bureau

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Showing 20 posts in Real Estate Settlement Procedures Act.

No Formal Grace Period for TILA-RESPA Integrated Disclosure Rule (TRID) – August 1 Implementation Effective Date Still Stands

UPDATE: On Wednesday, June 17, CFPB Director Richard Cordray issued a statement on a proposed amendment to the Truth in Lending and Real Estate Settlement Procedures Act Integrated Disclosure Rule (TRID). Citing an administrative error that violated federal law and would delay the operative date of the rule by two weeks, the amendment proposes to delay the enforcement of the rule until October 1, 2015. Read More ›

Director Cordray Increases Respa Disgorgement Penalty Against PHH Seventeen Fold

In what was the first appeal of an administrative decision before the CFPB, Director Richard Cordray issued a decision on June 4, 2015 that increased disgorgement sanctions against PHH Corporation from $6.4 million to approximately $109.2 million. The decision drew an immediate vow from PHH to appeal the decision, perhaps driven to some extent by the stark increase from the financial penalty contemplated by an Administrative Law Judge’s ruling. Read More ›

Lesson Learned from CFPB’s Actions against Banks Engaging in Illegal Marketing Services Kickback Scheme

Under Section 8 of the Real Estate Settlement procedures Act (RESPA), it is illegal for anyone to give or receive a fee, kickback or anything of value in exchange for referrals of settlement service business to a particular person or organization relating to a federal mortgage loan. Violations of this section of RESPA are subject to civil and criminal penalties which could be assessed in the form of a fine, imprisonment or both. Read More ›

Eighteen Months after Bulletin 2013-01, CFPB Issues New Guidance on Mortgage Servicing Transfers

Mortgage servicers and subservicers should consider reviewing the August 19, 2014 bulletin from the Consumer Financial Protection Bureau (CFPB) on mortgage servicing transfers to ensure compliance with the most up-to-date guidance.  This bulletin replaces the February 2013 bulletin on the same topic, incorporating the January 10, 2014 revisions to Regulation X, which implements the Real Estate Settlement Procedures Act (RESPA).  For servicers who have fully implemented the CFPB’s February 2013 guidance and the new servicing rule, we do not expect the information in the new bulletin to require significant changes to policies and practices.  Rather, the bulletin may provide a useful set of benchmarks and reminders.  Read More ›

CFPB Publishes Guide to the TILA-RESPA Loan Estimate and Closing Disclosure Forms

The Consumer Financial Protection Bureau (CFPB) on April 17, 2014 announced the release of a Guide to Completing TILA-RESPA Integrated Disclosure Forms (the Forms Guide). The CFPB states that the purpose of the Forms Guide is to provide instructions for completing the two new integrated TILA-RESPA disclosure forms, the Loan Estimate and Closing Disclosure, and to highlight common situations that may arise when completing the forms. Additionally, as the changes related to the TILA-RESPA Integrated Disclosure Rule may take time, resources, and planning to execute, the CFPB hopes the Forms Guide will help identify some of the necessary changes that may need to be implemented by organizations involved in the origination of closed-end residential mortgage loans. Settlement service providers, software providers, and other companies that serve as business partners to creditors may also find the Forms Guide helpful  Read More ›

CFPB Releases Small Entity Compliance Guide for TILA-RESPA Integrated Disclosure Rule

In late March, the Consumer Financial Protection Bureau (CFPB) issued a  Small Entity Compliance Guide (Guide) for the TILA-RESPA Integrated Disclosure Rule (TILA-RESPA Rule). In compliance with Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996, the CFPB has issued the guide to help small businesses comply with the TILA-RESPA Rule, which is effective August 1, 2015. Read More ›

CFPB Enforces RESPA Referral Prohibition Against Mortgage Lender

On January 16, 2014, Director Richard Cordray and the CFPB announced the entry of a Consent Order involving a mortgage lender, Fidelity Mortgage Corporation (FMC), and its President for alleged violations of Section 8 of the Real Estate Settlement Procedures Act (RESPA).  Although FMC and its President neither admit nor deny the CFPB's allegations, the Consent Order entered against the company and its President are instructive of potential future actions by the CFPB in connection with purported RESPA violations.  Moreover, since the CFPB recently took action under RESPA against two other third parties, a law firm and a home builder, we believe this action signals that the CFPB intends to actively police for RESPA enforcement.   Read More ›

CFPB Publishes New Mortgage Disclosure Forms

On November 20, 2013, the Consumer Financial Protection Bureau (CFPB) issued a 1,887 page rule requiring mortgage lenders to use two new disclosures when making mortgage loans to consumers.  The new forms are a "Loan Estimate," which replaces the preliminary Truth-in-Lending Disclosure Statement and Good Faith Estimate, and a "Closing Disclosure," which replaces the final Truth-in-Lending Disclosure Statement and HUD-1 Settlement Statement.  Mortgage lenders must use the new forms by August 1, 2015. Read More ›

CFPB Publishes Two More Small Entity Compliance Guides

Adding to its growing library of Small Entity Compliance Guides, on June 7, 2013, the Bureau of Consumer Financial Protection (“CFPB”) released guidance on the revised Regulation Z (TILA) Loan Originator Rule and the new Mortgage Servicing Rules under Regulation Z (TILA) and Regulation X (RESPA). The rules were issued in January 2013, and compliance with the rules becomes mandatory on January 10, 2014. As with previous Small Entity Compliance Guides published by the CFPB, the latest publications will be useful tools to mortgage lenders and servicers of all sizes. Read More ›

Private Mortgage Insurance: Does the CFPB’s Latest Enforcement Action Effectively Regulate Captive Reinsurance Out of Existence?

Today (4/4/13), the CFPB announced enforcement actions against, and settlements with, four mortgage insurers involving what “the Bureau believes to be improper kickbacks paid by mortgage insurers to mortgage lenders in exchange for business.” The CFPB alleges that, in exchange for business referrals, the four insurers—Genworth U.S. Mortgage Insurance Corporation, United Guaranty Corporation, Radian Guaranty Inc., and Mortgage Guaranty Insurance Corporation—violated RESPA by providing kickbacks to lenders in connection with the purchase of captive reinsurance, which the CFPB claims were designed to help lenders obtain greater profits. The CFPB contends these captive reinsurance deals violated RESPA because the projected value of the reinsurance was less than the reinsurance premiums paid by mortgage insurers to the reinsurer. Under the terms of the proposed consent orders filed with the United States District Court for the Southern District of Florida, the mortgage insurers will: (i) pay a collective $15 million in penalties to the CFPB; (ii) cease the paying “illegal kickbacks”; (iii)  not enter into new captive mortgage reinsurance arrangements with affiliates of mortgage lenders; and (iv) submit to compliance monitoring and reporting.  Read item (iii) carefully:  All four companies agreed that they would NEVER AGAIN enter into captive mortgage reinsurance arrangements with mortgage lenders.   Read More ›