Tag Archives: CFPB

California district court upholds constitutionality of CFPB

A U.S. district court judge in the Central District of California defended the constitutionality of the Consumer Financial Protection Bureau after rejecting multiple challenges to the bureau’s authority to issue civil investigative demands (CID),according to a blog by James Kim and Daniel Delnero, published in the CFPB Monitor.

The decision comes amid a growing amount of cases disputing the constitutionality of the bureau, which includes the landmark case between the CFPB and PHH that started oral arguments this week.

The blog explained that the judge ordered the defendant, Future Income Payments, to comply with a CID within fifteen days of the decision after the company previously attempted a John Doe challenge to the CID in the U.S. District Court for the District of Columbia.

From the blog:

The opinion is a reminder of the CFPB’s broad authority to issue a CID and the heavy burden a recipient bears of challenging it. The court joined other courts in emphasizing that an agency subpoena is valid unless jurisdiction is “plainly lacking.” Under this standard, a CID will be upheld if “there is some plausible ground for jurisdiction.”

Constitutional issues aside, the primary takeaway is that companies should think strategically when they receive a CID.

Read on.

CFPB deepens probe into Zillow for RESPA compliance

Housingwire:

This is taken from the latest Zillow earnings report:

In April 2017, we received a Civil Investigative Demand from the Consumer Financial Protection Bureau (“CFPB”) requesting information related to our March 2017 response to the CFPB’s February 2017 Notice and Opportunity to Respond and Advise (“NORA”) letter. The NORA letter notified us that the CFPB’s Office of Enforcement is considering whether to recommend that the CFPB take legal action against us, alleging that we violated Section 8 of the Real Estate Settlement Procedures Act (“RESPA”) and Section 1036 of the Consumer Financial Protection Act.

They later add they believe they fully comply with RESPA:

We believe our response to the NORA letter addresses the CFPB’s concerns related to our co-marketing program under which a lender pays us to appear in advertising alongside a real estate agent. We are continuing to cooperate with the CFPB in connection with their most recent request for information. We continue to believe that our acts and practices are lawful and that our co-marketing program allows lenders and agents to comply with RESPA.

CFPB sues Ocwen, alleges total failure of mortgage servicing process

Ocwen is still repeated offenders. When are the execs and board members get charged???

April 20, 2017 is turning into D-Day for Ocwen Financial.

On Thursday, a group of state banking regulators issued a series of cease-and-desist orders to Ocwen that prohibit the acquisition of new mortgage servicing rights and the origination of mortgage loans by Ocwen Loan Servicing, a subsidiary of Ocwen, until the company is “able to prove it can appropriately manage its consumer mortgage escrow accounts.”

But that’s only one front. Ocwen now has a much bigger fight on its hands – with theConsumer Financial Protection Bureau.

The CFPB announced Thursday that it is suing Ocwen Financial for “failing borrowers at every stage of the mortgage servicing process.”

According to the CFPB, its lawsuit alleges that Ocwen cost borrowers money, and in some cases, their homes, with its years of “widespread errors, shortcuts, and runarounds.”

In its lawsuit, the CFPB says that Ocwen “botched basic functions like sending accurate monthly statements, properly crediting payments, and handling taxes and insurance.”

The lawsuit also claims that also “illegally foreclosed on struggling borrowers, ignored customer complaints, and sold off the servicing rights to loans without fully disclosing the mistakes it made in borrowers’ records.”

The CFPB claims that it uncovered “substantial evidence that Ocwen has engaged in significant and systemic misconduct at nearly every stage of the mortgage servicing process.”

Read on.

CFPB fines Experian $3 million for lying about consumers’ credit scores

Experian, one of the nation’s three major credit reporting bureaus, misled consumers by telling them that the credit scores they purchased from the company were the same ones that lenders used to make credit decisions, the Consumer Financial Protection Bureau said Thursday.

And for that deception, the CFPB is fining Experian $3 million.

According to the CFPB, Experian developed its own proprietary credit scoring model, which it calls the “PLUS Score.” Experian then took that “PLUS Score” and applied it to information in consumer credit files to generate a credit score it offered directly to consumers.

Read on.

Nationstar facing CFPB fine over HMDA violations

Nationstar Mortgage is facing a fine from the Consumer Financial Protection Bureau over the nonbank’s alleged failure to comply with the reporting requirements of the Home Mortgage Disclosure Act, the company revealed Thursday.

Nationstar disclosed the potential fine in its 10-K filing with the Securities and Exchange Commission.

In the filing, Nationstar said it is “currently in negotiations with the CFPB regarding the payment of civil monetary penalties for the alleged failure to comply with the reporting requirements of the Home Mortgage Disclosure Act.”

The Home Mortgage Disclosure Act, referred to as HMDA, was originally enacted in 1975 and requires many financial institutions to collect data about each company’s housing-related lending activity.

Read on.

Ocwen SEC filing reveals details of CFPB mortgage servicing investigation

During a call with investors to discuss the company’s fourth-quarter earnings, Ocwen Financial CEO Ron Faris said resolving the Consumer Financial Protection Bureau’s investigation into the company’s mortgage servicing practices is a top priority in 2017.

In Ocwen’s third-quarter 10-Q filing with the Securities and Exchange Commission, the company revealed that it could be facing a fine and/or other disciplinary action from the CFPB.

Read on.

Court: CFPB Has Authority To Request Seven Years’ Worth Of Foreclosure Documents

Back in November, the Consumer Financial Protection Bureau filed a lawsuit against one of the nation’s largest providers of seller-financed homes after it failed to comply with a subpoena to turn over documents related to home foreclosures. This week, a judge upheld the Bureau’s authority to request the documents from Harbour Portfolio Advisors. 

A Federal District Court in Detroit issued a 12-page decision [PDF] directing Dallas-based Harbour Portfolio Advisors to comply with the CFPB’s request for documents and other information related to its investigating into housing finance.

The case against Harbour began back in Sept. 2016 when the CFPB began looking into whether financing offered by the company and others like it — referred to as an “Agreement for Deed” — were in violation of federal leading laws.

An Agreement for Deed is a written agreement to purchase a residential property, where the seller agrees to deliver a deed to the purchaser upon full payment of the purchase price.

This so-called rent-to-own policy, the New York Times reports, became popular during the housing crisis when it was difficult for consumers to obtain mortgages and alternative lenders stepped in to fill the gaps.

Harbour Portfolio bought nearly 7,000 properties from Fannie Mae after the housing crisis, paying roughly $10,000 or less for each, the New York Times found in an investigation. The company then turned around and sold the properties “as is” at a rate four or five times higher than the purchase price.

Read on.