Last month involved several regulatory compliance updates and hot topics in the Mortgage industry. We’ve rounded up some key updates and how they will affect you and your financial institution going forward.
CFPB Warns Servicers: “Unprepared is Unacceptable”
The Consumer Financial Protection Bureau (CFPB) is warning servicers that it is ramping up enforcement and will be specifically watching how servicers manage borrowers coming out of forbearance.
In a Thursday compliance bulletin, the CFPB said it will monitor how servicers work to prevent a wave of foreclosures from occurring this fall. “Unprepared is unacceptable,” the Bureau said. The CFPB will closely monitor how servicers engage with borrowers, respond to borrower requests and process applications for loss mitigation.
“There is a tidal wave of distressed homeowners who will need help from their mortgage servicers in the coming months. Responsible servicers should be preparing now. There is no time to waste, and no excuse for inaction. No one should be surprised by what is coming,” said CFPB acting Director Dave Uejio.
Why Is This Important to Me and My Financial Institution?
The CFPB is clearly signaling they intend to take a more active role in protecting consumers under this administration. For servicers looking to ensure compliance, OnCourse Learning recently released a 12-part Mortgage Servicing Compliance Series designed to both educate your staff and reduce your risk!
Mortgage Applications Continue to Fall, Inventory Remains Low
Mortgage applications declined for the week ending April 9, according to the latest report from the Mortgage Bankers Association. It’s the sixth consecutive week of falling mortgage applications.
Applications were down 3.7% from the week ending April 2, with rising mortgage rates and low inventory contributing to the slowdown and leading to a decline in purchase mortgage activity, said Joel Kan, MBA’s associate vice president of economic and industry forecasting.
“The third straight week of declining purchase activity is a sign that rising home prices and tight supply is constraining home sales – especially in the lower price tiers,” Kan said. “Purchase applications were still above last year’s pandemic-impacted low point, but fell behind the level of activity seen the same week in 2019.”
Why Is This Important to Me and My Financial Institution?
As rates trend slowly upward and the refinance bubble bursts, now is the time for lenders to lean into their referral networks and get laser focused on purchase business. This is a challenging market, with limited inventory, so it will take longer for those prequals and pre-approvals to turn into applications given the competitive marketplace for homebuyers. Lenders and loan officers who build their pipelines now will enjoy continued lending success in the future!
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*For other news, please refer to Industry News through Mortgage HQ!
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To see a demo that will give you access to valuable training topics like these and more, visit OncourseLearning.com/Mortgage-H-Q.
About the Author
Michael Rhodes
Product Manager at OnCourse Learning
Michael Rhodes is the Product Manager for the mortgage segment at OnCourse Learning. Michael has worked in the financial services industry for 24 years and keeps up to date on mortgage industry hot topics. Michael received his Bachelor of Arts in Business Administration from Carroll University.
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