CFPB Reveals Plans for Mortgage Oversight, Rulemaking

A Nationwide Mortgage Licensing System & Registry (NMLS) conference held in early February in Scottsdale, Arizona shed some light on what the CFPB will actually look for in its non-bank mortgage examinations—and where it will begin those audits.

According to the Todd Ausherman, co-founder of San Diego-based Legacy Reverse who attended the NMLS Annual Conference & Training in early February, CFPB representatives told attendees that while they are still very much in the learning phase of their examinations, they’re going to begin examining companies based on size, because of the lack of bandwidth the bureau currently has.

“They’re going to look first at the companies with the biggest reach to consumers,” says Todd Ausherman. “So the smaller companies are unlikely to be examined, at least in the short term.”


Next on the CFPB’s list will be companies with a disproportionate number of complaints.

“The second tier will likely be those with a disparate amount of complaints versus like sized companies. Those will be next,” Ausherman said.

Conference attendees heard from CFPB leadership Peggy Twohig, Assistant Director, Nondepository Supervision and Allison Brown, Supervisory Consumer Financial Protection Analyst.

The CFPB currently has just under 800 staff total, according to its recent reports.

“Uncertain seems to be the word of the day,” Ausherman says. “The thing that really struck me that they say they have created very little original content. They are instead taking from other entities that fall under their jurisdiction.” Ausherman noted that the CFPB reps said they are taking most current rules almost or fully verbatim, without the intention to make big waves.

The first real rule we are likely to see is when the CFPB combines TILA and RESPA by January 13, 2013, Ausherman says, based on the CFPB commentary. That rule, he says, will be telling as it will indicate how far the CFPB will go toward developing new rules that are not simply reaffirmations of previous rules.

As for small companies, Ausherman speculates they might see effects of the new bureau trickle down to the state level.

“I think that’s how smaller companies are going to be more directly affected. We will see more in state regulations with the same standards at a minimum.”

Written by Elizabeth Ecker

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  • It will not stop with the CFPB. Going after the largest companies because they are exposed to the greater amount of seniors? Is the CFPB saying the largest companies will be more apt to rip off the senior than the small one’s. Wait, maybe they are saying they can get more revenue out of a larger amount of people being examines because of the size of the companies?

    I see they have as one of thier their priorities the consumer’s concern and welfare. Second, not first on the list are those companies with a disparate amount of complaints.  Personally I think the senior should be the number one concern but we are talking about the CFPB who sets the priorities!

    2012 is going to be a year the CFPB will have to do its most damage to our industry and the entire financial industry. After the elections, it may be a different ball game? Please don’t take me the wrong way, some of what the bill and the CFPB stands for is good and will protect the consumer. The problem is that the greater majority of the bill and what the CFPB stands for is not good and is damaging in the long run to our entire financial system!

    I know I come out strong against the CFPB every chance I get but look at the history of the bill that created the CFPB and all the controversy surrounding the CFPB. Look at the bank failures since they came into  existents, read the bill itself if you want to see the dangers we face! I continue to say, repeal, repeal and repeal my friends!

    John A. Smaldone 

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