Mortgage News July 8: CFPB update; implementing best secondary practices

Rob Chrisman

[This is the last day for quite some time that I am away from the computer on a daily basis. This is the last guest writer spot, and I very much appreciate the time and effort that the contributors put forth. As I have mentioned, I gave them very little direction, and they rose to the occasion. Our views may or may not coincide, but once again I thank them for their time in volunteering and helping out.]

A talent for writing runs in my family, as does musical aptitude. Disappointingly, both talents widely dodged me and I am left instead to merely stake my claim as the tallest of the Farmer clan (locally, of course.) Since my lofty stature is not particularly useful to me as guest writer for the Chrisman letter; forgive me if  I borrow the writing talent from others. But first, I really have to give kudos  to Rob for the fine work he does. It is a tremendous challenge to come up with stimulating material on just a 'one-off' basis, doing this daily is beyond my comprehension.

Casey Anthony... I'm a little late to the story and don't have anything to say about her trial that hasn't been said, but I was worried that not mentioning her case would render my contribution irrelevant. In googling [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeyxTf2F-eOVVo7gS6Pjjl6vmuylTx_T0B_5yDubuT6atVcFyyaOYbcHJj-2n6AkUxUXNJyDihHn_8QPtnFtDzeMb8PwlqcZ7O9WxRQbH2yG7xcGYMKH5gRZMMdmko40ECUvr6eezsDdZSw==]

mortgage industry with Casey Anthony Trial, I discovered that Frank Hillard [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeyweLcJAThofaQ6PqWo9so2LvtjBDUhKiBbZaLWBSpBVZXvnIJq6SaNUFGOrBLxdOyfYTyER4ebe-8yn7iFV6LvN_XWLPQ4MjPhUkUVIhDfkgxLLUSTg8P7wBnh1h56pjOD3OSahIBIqALvaTGGNijcMDdFp7Vilje-YlswJaDRct5c10_LybVR2jYc1gmpDQ9qr1dPEt0QpPw==]

does have an opinion, albeit, one he describes as, "probably very unpopular." I've heard comparisons of this trial to the O.J. affair, but only in its 'shocking' verdict and massive media coverage. The Anthony trial does not seem to engender social divisions the way the O.J. trial reactions often split along racial lines.

Mortgage bankers have had tremendous change thrust upon them in recent years. New regulations applied (RESPA, HVCC, TILA, SAFE Act, etc.) have typically required the development and deployment of new operating processes, investments in new (or upgraded) technologies, additional headcount, and ultimately, higher costs and reduced margins for the mortgage banker. While bankers search for the right tools and the right policies to achieve the most favorable balance between rate competitiveness and compliance with the new regulations, most agree that these changes will present additional challenges to their profitability. For many bankers, a secondary process that fully leverages the secondary mortgage market for additional profitability is no longer just a "nice-to-have," but rather the new imperative for success. Read more on implementing best secondary practices in this White Paper [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeywcvTuLAUGPl5XvvEt2g0kqqHjjA3Pw14NRUjqV4Z2bMY-PbcWHsvShFkwXJNhKzmMVtV8-HYkUIGPN0E1i7ozZIA-9p231t4sECVhmRZvZ4Ib0s2P0hzOb66ukh98Nf-MSm2OA_o6H_Qtfb2Q0P1NT].

(Full Disclosure: MCT President, Curtis Richins, wrote the linked document as commissioned by NYLX. It is both useful and informative.)

With all the changes in our industry, it is comforting to note that we are not alone in our need to adapt. Consider the current NFL negotiations on changes to revenue sharing, salary caps, and other points of interest. Sam Farmer, Los Angeles Times NFL Columnist (my younger brother and recipient of all the writing talent in his  Farmer generation,) provides a solid Q&A [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeyz89rd-6iqPzu1hZb81bwGjdDkBwBtMgbWSDB0WvZkB-6UKtdux8R5bwTvqwXFSIbVqMuaTkS1hxJtxnWidSr52GHTPJ7CdDoYX5AIwgz0iIPb2rhWG6iJHJmnBeKBu8MFQl6mlzRBFFvr08tXGQiLDw6pmvGKYVZr_npKpVdRkW0vjn2YK-Lt1]

on the current state of negotiations, predictions on timing, and perspective on the winners/losers. One similarity I see between the football and the mortgage lending industries is the resilience that both demonstrate in finding paths across seemingly impassable chasms.

The Consumer Financial Protection Bureau (CFPB) has about 35 openings [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeywAw3Mb7PdSTDAQ0dFrUmI2OEsND1XLMx6qBkZ2Ze8uiqD74bCrpZVjTNzCbz7FkTjakhdoI_XVsWEni2K3KO4JmC-2Y86fEt7v_OSdc-TuWBZLm7_7VcC5khcm86NeGNA=]

across offices in D.C., Chicago, NYC, and San Francisco. (And Rob gives an update

- see the bottom paragraph.) The salaries are higher than I expected. Here is one in New York (2 openings.)

Supervisory Examiner, Assistant Regional Director

CLOSES JULY 29, 2011

GRADE 7A [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeyxUdZbVqM2n7U0Pegq5K1wTR9OPF5avNIgc7OQ931M2bbK3evw7DePvHIv2RTGa0HjDTYfqJKFuNpyROXbiqchtNs2A2lYbO_-LULJkybCkLM7PIOnar1ol4A8257a49k_Yh82azooeFH5ey-_349lSbZij34JIidFEYf1Y82j8sDNLYdVkwL6cp5L0CipaQs31-FULI-gWoAMeilSuHrdsmUEWqxbZU3bvEB9wWpYXa9Nw8XuHJYQzMjiS9ZK41IxpJE5sAyHPVvIjUvkMiQErHyMJDxZtofudSEnONT6bSG4zirETAyZtoTyi1umRh2HHD_rF8176cKDxyqs6bw7bddfohSDKgRyJfCgjemQV-83nUd-TYsrT4w9guEBQfI01xkYm86MBYKLVqy2dTXBBTz9ptk3VaV8BoMmPQG-NgIBJo4YLbMQdoofn64NPuE_ZqloDjGMogqWoD2Bnk_Ws]

$142,443 - $264,803

Open to candidates with permanent competitive service status, non-competitive eligibles, and special appointment eligibles.

It looks like the life of a civil servant is becoming more desirable. NOTE: I don't know any details other than those on the site.

While on the topic, the CFPB received substantial response to the two latest combined TIL/GFE prototype forms; Redbud [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeyyAqSAJ3bd0NR1mLBbdonGl-yrDInMk08ECAYAMlUgBlIQd9qjuYbNISi4gWAdvExM_KOcKxhygHB9idBVnPYocm8MEsbawAMt4Q9fZM6Ysyu_EVAjFcuCnllqMX0Q_zTo3c_yoyRnaNXBJsL5TumNRSwI-g7_VrkXfG3zpr3jB6w==]

and Dogwood [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeyyy1ndsYAy211ZsRVqFG7WtlD7Nmebs3X5q-p7hA321CPhTmZmSe-gQjhVJmLrhYwAymdVZAkGqdQbNKObHPjk1NXreXE-Ah_D1KGuY8zWD2HAnhMX1ij8QXc2LpYyKzV-pIhIcqJQH1tdT8R4eEbXIIwTKTm-gV0ZrWgWIhwpnxQ==].

The two prototypes make identical presentations of loan terms, projected payments, and comparisons but differ substantially in the manner in which they present loan estimate details. The first request for feedback on the initial prototypes received in excess of 13,000 responses. No definitive number on the most recent round for  input that closed July 5th. Which do you prefer and why? Here is a letter [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeyzBdLi2vLs3L2CC7217ZE_2DmnJRou2fRvr8FnZCAy-Cp8aljEKAwv_0sMkM7eBKiq2BLha5UxAFkq4lr_b2RxXyUV5DpUHx098nkchXChx7tw9PVxpRjkQiQFbwER4wSgHIl9McLDrZKyJVh3W1EvXu_RtAEd2u2roBdg_PlKtlA==]

from the MBA to Elizabeth Warren, Assistant to the President and Special Advisor  to the Treasury Secretary (CFPB Chief), appreciating improvement over the last prototype and expressing continuing concerns on the new drafts.

Since Rob is in Europe, I thought it might be appropriate to share a European perspective on Americans [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106464125684&s=8721&e=001Qp2YkJaoeyyWNsomINdPlZXfFJ5Y6LJg1XHagtB84cs-xNX115RnpI32vLgn0m0MGFtnqQ5b9MUhf15wvV0O2FOZXpbCgFn_oXsONCrVzsYvTMAhbmfSKmCo6QiQ3DeU]

and our culture. This is a pretty tight summary!

Thomas P. Farmer

MCT, Inc.
tfarmer@mctrade.net [mailto:tfarmer@mctrade.net]
(619) 543-5111 main
(619) 534-1597

If you're interested, visit Rob's twice-a-month blog at the STRATMOR Group web site located at www.stratmorgroup.com [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&et=1106435366068&s=4179&e=001SVt-ljbp53436QjxD9vbwURtIPPjV05jEcEKyBN3SjS2forXe0C_foO8RjEV-Uye0N7Z_Sh1il0SRXPx6PjQauayNXQjni-Hc9Sseu-hhZcR1ujeZyAEpw==]

The current blog takes a look at early actions taken by the new CFPB and the political situation affecting it. If you have both the time and inclination make a comment  on what he has written, or on other comments so that folks can learn what's going on out there from the other readers.  .

Rob

(Check out http://www.mortgagenewsdaily.com/channels/pipelinepress/default.aspx

[http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&t=uxmngpgab.0.epg7qedab.zy6u9cdab.8721&ts=S0643&p=http%3A%2F%2Fwww.mortgagenewsdaily.com%2Fchannels%2Fpipelinepress%2Fdefault.aspx]

or www.TheBasisPoint.com/category/daily-basis [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&t=uxmngpgab.0.v7uif6dab.zy6u9cdab.8721&ts=S0643&p=http%3A%2F%2Fwww.thebasispoint.com%2Fcategory%2Fdaily-basis].

For archived commentaries, go to www.robchrisman.com [http://r20.rs6.net/tn.jsp?llr=zy6u9cdab&t=uxmngpgab.0.fpg7qedab.zy6u9cdab.8721&ts=S0643&p=http%3A%2F%2Fwww.robchrisman.com%2F].

Copyright 2011 Rob Chrisman.  All rights reserved. Occasional paid notices do appear.

This report or any portion hereof may not be reprinted, sold or redistributed without the written consent of Rob Chrisman.) ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

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