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CFPB Fines Texas-Based Firm for FCRA Violations


The Consumer Financial Protection Bureau (CFPB) has taken action against an auto finance company that distorted consumer credit records for years. Texas-based First Investors Financial Services Group Inc., which lends primarily to sub-prime borrowers, failed to fix known flaws in a computer system that was providing inaccurate information to credit reporting agencies. This potentially harmed tens of thousands of its customers.Click to continue

New Homebuyers and Understanding Different Types of Home Loans

The increase in real estate sales across the nation has spurred new homebuyers to take a look at buying their first piece of property. Even with rates on the rise, many potential new homebuyers are looking to buy before it’s too late. People assume conforming loans are actually the same as conventional loans. However, this is not the case; conventional loans can be either conforming or non-conforming loans. Let’s take a look at some of the different types of loans and what they mean for you.Click to continue

Number of Consumers With Sub-Prime Credit Scores Dwindles

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The number of consumers with sub-prime credit scores is shrinking across the country, according to new data from Equifax. The total number of consumers with Equifax credit scores below 620 fell 2.1 percent, or by about 1 million consumers, in the third quarter of 2012 versus the third quarter of 2011. The overall share of consumers with Equifax credit scores under 620 fell by 0.7 percent (from 25.9 percent to 25.2 percent) during that same period.Click to continue

The Rationality of the Wholesale Lending Market

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The year was 2005. Nearly 80 percent of all loans originated during this peak year of the housing boom were originated by mortgage brokers. What got lost in the post-bubble chaos and finger-pointing was an explanation as to why the vast majority of Americans had sought out mortgage brokers to handle this most important of financial transactions. Historically, the reason for the dominance of mortgage brokers has been the ability to offer the best combination of expertise, experience, price and service.Click to continue

ACLU Files Housing Discrimination Suit Against Morgan Stanley

Cherry Red Gavel/Credit: Comstock

According to a lawsuit filed by the American Civil Liberties Union (ACLU), Morgan Stanley discriminated against black homeowners and violated federal civil rights laws by providing strong incentives to a sub-prime lender to originate mortgages that were likely to be foreclosed on. The lawsuit, filed in U.S. District Court in New York, is the first that connects racial discrimination to the securitization of mortgage-backed securities (MBS), which were sold to institutional investors and pension funds.Click to continue

Mortgage Delinquencies Rise 18 Basis Points in Q2


The delinquency rate for mortgage loans on one- to four-unit residential properties increased to a seasonally adjusted rate of 7.58 percent of all loans outstanding as of the end of the second quarter of 2012, an increase of 18 basis points from the first quarter, but a decrease of 86 basis points from one year ago, according to the Mortgage Bankers Association’s (MBA) National Delinquency Survey. The non-seasonally adjusted delinquency rate increased 41 basis points to 7.35 percent this quarter from 6.94 percent last quarter.Click to continue

Summer Months Bring 3.4 Percent Rise in Nationwide Delinquency Rate


Lender Processing Services Inc. (LPS) has reported the following "first look" at June 2012 month-end mortgage performance statistics derived from its loan-level database representing approximately 70 percent of the overall market. With the June 2012 month-end data, LPS has updated its extrapolation methodology to incorporate, among other things, improved estimates of market size, which includes higher coverage of government and sub-prime products and increases LPS' estimate of the total first lien residential mortgage market by three percent to 50.4 million.Click to continue

AARP: Record Number of Seniors Facing Foreclosure


AARP’s Public Policy Institute (PPI) has released a new study measuring the progression of the mortgage crisis and its effect on people age 50 and older. Looking at nationwide loan-level data for 2007 through 2011, the analysis finds that more than 1.5 million older Americans lost their homes since 2007. The study also finds that the percentage of seriously delinquent loans—those in foreclosure and loans 90 or more days delinquent—increased from 1.1 percent in 2007 to six percent as of December 2011 for people age 50 and older, a more than fivefold increase.Click to continue

NAMB Comments on Wells Fargo’s Exit From the Wholesale Channel


Wells Fargo has announced that as of July 13, 2012, the company is no longer going to accept mortgage loans from independent mortgage brokers. According to an official statement from Wells Fargo, the company’s decision to discontinue funding mortgages originated, priced and sold by independent mortgage brokers through its wholesale channel is not related to a discrimination lawsuit filed by the U.S. Department of Justice (DOJ) against Wells Fargo.Click to continue

DOJ Reaches $125 Million Settlement With Wells Fargo on Lending Discrimination Charges

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The U.S. Department of Justice (DOJ) has filed the second largest fair lending settlement in the Department’s history to resolve allegations that Wells Fargo Bank engaged in a pattern or practice of discrimination against qualified African-American and Hispanic borrowers in its mortgage lending from 2004 through 2009. The settlement provides $125 million in compensation for wholesale borrowers who were steered into sub-prime mortgages or who paid higher fees and rates than White borrowers due to their race or national origin.Click to continue