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Tag Archives: OTS

Government Accountability Office Pushes for Servicing Accountability

In the wake of the industry's robo-signing issues, the Government Accountability Office (GAO) has released a report urging the new Consumer Financial Protection Bureau to make mortgage servicing standards a priority. After examining applicable laws and interviewing mortgage investors and other industry participants, the agency concluded that federal laws do not specifically address the foreclosure process, and as a result, oversight of servicers has been ""limited and fragmented.""

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Wingspan Bolsters Audit Services to Help Clients Satisfy Consent Orders

Wingspan Portfolio Advisors, a specialty and component mortgage servicer, added 100 employees in the past 60 days to help servicers stay compliant with the interagency review issued this month by the Federal Reserve, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision. Two key enforcement actions were included in the consent orders for each servicer examined -- the hiring of an an independent consultant to review residential foreclosure actions from 2009 and 2010, and an expert assessment of risks in servicing operations.

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Regulators Assure Public Fines Are Coming for Robo-Signing Offenses

The retrospective foreclosure reviews mandated in the consent orders issued to servicers this week will help regulators evaluate the extent of the problem and determine the amount of monetary fines that should be assessed, according to John Walsh, head of the Office of the Comptroller of the Currency. Walsh says in addition to these punitive penalties, servicers will have to absorb ""substantial expense"" to fix their problems and are obligated to provide restitution to borrowers who suffered financial harm ""with no dollar cap.""

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Rifts Continue to Surface Around Robo-Signing Settlement

Federal regulators split from state attorneys general last week to cut their own deal with mortgage servicers as part of a settlement for the robo-signing mess that surfaced last fall. Critics of the side deal are calling for federal regulators to withdraw their agreements and work with the states to hold banks accountable. But even in the attorney general camp there has been dissension. A study released Tuesday by three economists says the original settlement proposal backed by state counsels could increase the foreclosure inventory by $297 billion.

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Let’s Make a Deal: Feds Move on Robo-Signing Settlement Without AGs

Mortgage servicers have reportedly reached an agreement with federal regulators to change their foreclosure procedures as part of a settlement for the robo-signing transgressions that were uncovered last fall. The arrangement includes no fines, but monetary penalties have not been completely ruled out. In early March, federal regulatory agencies and state attorneys general together crafted a 27-page settlement proposal, however, the states have not been part of this latest development.

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Completed Foreclosures Down by Nearly 50% Among Largest Servicers

The nation's largest mortgage servicers foreclosed on 95,067 homes during the fourth quarter of 2010, a 49 percent drop from the number of completed foreclosures during the previous quarter, according to a new report from two regulatory agencies. Newly initiated foreclosures also decreased but by a much smaller ratio of 8 percent. Because new foreclosures outpaced completed foreclosures, the inventory of foreclosures in process increased to 1,290,253, representing 3.9 percent of all serviced loans among the largest national firms.

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Regulators Propose Rule to Link Executive Pay to Risk

Federal regulators proposed a new rule Wednesday that would require certain financial institutions, including large mortgage lenders, to account for risk as they structure incentive compensation packages for executives and employees. New rules for risk-based pay are a mandate of the Dodd-Frank Reform Act and are aimed at stemming the type of risky lending and investment gambles that many economists say pushed the nation's financial system to the brink of collapse.

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New Consumer Bureau to Put Down Roots Across from White House

Location, location, location. Elizabeth Warren says ""that's the real estate mantra, and the new consumer bureau is following the professional's lead."" The U.S. Department of the Treasury announced late last week that the future permanent headquarters of the Consumer Financial Protection Bureau (CFPB) will be located at 1700 G Street, NW in Washington, D.C., just across the street from the White House complex.

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Servicers Face New Rules, Penalties for Foreclosure Processing Mistakes

When evidence surfaced last fall of flawed foreclosure documentation and robo-signers within some of the nation's largest servicing shops, federal regulators launched an investigation into the foreclosure and servicing practices of 14 companies. Officials say they've uncovered ""critical deficiencies and shortcomings"" and will be enforcing sanctions and penalties against servicers and developing a set of national mortgage servicing standards for the industry.

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Veros White Paper Highlights Interagency Appraisal Guidelines

Veros, a provider of collateral valuation technology, enterprise risk management, and predictive analytics, recently released a white paper titled ""Interagency Appraisal & Evaluation Guidelines: Insights into Understanding and Integrating the New Guidance."" The white paper seeks to clarify the expanded language in the guidelines issued by federal regulators last December.

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