News & Analysis as of

Underwriting Mortgages

Court Awards Nearly $280 Million in Treble Damages Against Former FHA Lender

by Goodwin on

On September 14, 2017, the U.S. District Court for the Southern District of Texas issued an opinion and order against two former mortgage companies and their former president and CEO. The order, which followed a previous jury...more

Ninth Circuit: Mortgage Underwriters Are Not Exempt

The U.S. Court of Appeals for the Ninth Circuit recently held that mortgage underwriters who worked for Provident Savings Bank were not “administrative employees,” and thus did not qualify for exemption from the overtime...more

Nutter Bank Report, July 2017

CFPB Arbitration Rule Will Prevent Firms From Blocking Class Action Lawsuits - The CFPB has approved a new rule that will prohibit banks and other covered providers of certain consumer financial products and services from...more

Federal Appeals Court Rules Mortgage Underwriters Owed Overtime for Work in Excess of 40 Hours in Workweek

by Ballard Spahr LLP on

The Ninth Circuit Court of Appeals issued a decision last week holding that mortgage underwriters are not exempt from the overtime requirements of the Fair Labor Standards Act (FLSA). The July 6 decision, which furthers a...more

OSFI Looks to Further Tighten Mortgage Underwriting Standards, Issues Revised Guideline B-20 for Comment

On July 6, 2017, the Office of the Superintendent of Financial Institutions (OSFI) issued a revised version of Guideline B-20 – Residential Mortgage Underwriting Practices and Procedures (Draft Guideline) for comment. This...more

California Amends RMLA: Federal Agency Approval Not Required For Processing and Underwriting Companies

by Ballard Spahr LLP on

Effective January 1, 2017, the definition of lender under the California Residential Mortgage Lending Act (RMLA) will be amended to include third-party processors and/or underwriters who do not solicit loan applicants,...more

CFPB issues report on servicemember complaints

by Ballard Spahr LLP on

A new CFPB report, “A snapshot of servicemember complaints,” focuses on issues related to VA mortgage refinancing. The report indicates that as of November 1, 2016, the CFPB had received over 12,500 mortgage complaints...more

Tennessee District Court Orders Discovery Of Reinsurance Agreements, But Denies Discovery Of Reinsurance-Related Communications,...

by Carlton Fields on

Plaintiffs sought coverage from the insurer Defendants for a $212.5 million dollar settlement of a claim of violation of the False Claims Act relating to errors and omissions in underwriting and origination of HUD mortgage...more

Loan Participations

by Barley Snyder on

The 2007-2010 period illustrated that lenders must use greater care when selling or purchasing participating interests in loans, if they are to achieve their business goals. Originators and sellers of loans may desire to...more

Will the DOJ Kill FHA Loans Through Their Use of the False Claims Act?

by Baker Donelson on

The purpose of the Federal Housing Administration (FHA) is "to help creditworthy low income and first time homebuyers, individuals and families often denied traditional credit, to obtain a mortgage and purchase a home." This...more

UK Financial Regulatory Developments - April 2016 #1

by Dentons on

Basel Committee updates Basel III monitoring FAQs - The Basel Committee has published an updated version of its Basel III monitoring FAQs, including new questions on the “DefCap” worksheet, large exposures and the...more

UK Regulator Proposes Standards for Underwriting Buy-to-Let Mortgages

by Shearman & Sterling LLP on

The Prudential Regulation Authority published proposals on minimum standards for firms when underwriting buy-to-let contracts. The proposals would apply to all PRA-regulated firms undertaking buy-to-let lending that are not...more

Summary of Final Rule Amending HMDA and What It Means for Covered Institutions

by Ballard Spahr LLP on

The Consumer Financial Protection Bureau (CFPB) has released a final rule amending Regulation C, which implements the Home Mortgage Disclosure Act (HMDA), requiring most lenders to report certain information about mortgage...more

Summary of HUD's LEAN 232 Program Email Blast Office of Residential Care Facilities (ORCF) August 28, 2015

by Pepper Hamilton LLP on

The August 28, 2015 LEAN Email Blast contains information on the final rule regarding fire safety equipment, the new delegated underwriter approval process, the Green Lane, and the mortgage termination process, among other...more

FHA Attempt To Provide New Guidance: Too Little, Too Late?

by Goodwin on

On June 18, the Federal Housing Administration provided lenders with a new Defect Taxonomy for Single Family Housing Loans, or Loan Quality Assessment Methodology. It has been working on the new taxonomy for almost a year,...more

Obtaining Title Insurance on Construction Loans: Avoiding Pitfalls Regarding Title Insurance Underwriting for Construction Loans

Avoiding Pitfalls in Construction Mortgages: Top 5 Tips for Title Insurance Underwriting - Construction mortgages pose significant risks for title insurers and require specific underwriting analysis. Avoid the...more

Summary of HUD's LEAN 232 Program E-mail Blast: Office of Residential Care Facilities (ORCF), April 30, 2015

by Pepper Hamilton LLP on

In an effort to summarize the highlights of the LEAN Email Blasts that we receive, and rarely have time to review in a timely fashion, we at Pepper Hamilton are providing this quick synopsis of the latest LEAN update. Our aim...more

SDNY Declines to Reconsider Denial of Plaintiffs’ Summary Judgment Motion in RMBS Putback Case

On February 25, 2015, Judge P. Kevin Castel of the S.D.N.Y. issued an opinion denying reconsideration of a January 9, 2015 order that granted in part and denied in part the parties’ competing motions for summary judgment in...more

Regulators Increase Scrutiny of Wall Street Lending

by Bilzin Sumberg on

Federal bank regulatory agencies are significantly increasing their scrutiny of Wall Street bank lending, moving from annual reviews to a system of monthly audits in a major effort to curtail aggressive underwriting...more

Managing Potential Sticker Shock – Agencies Release Guidance to Prepare Banks for HELOC End-of-Draw Periods

by Pepper Hamilton LLP on

On June 30, 2014, the federal financial institution regulatory agencies (the Agencies) published Interagency Guidance on Home Equity Lines of Credit Nearing Their End-of Draw Period (the Guidance), which, as the title...more

Consumer Financial Protection Bureau Implements 'Ability to Repay' Regulations for Covered Mortage Loans

It is a widely understood that loose underwriting standards and practices by some creditors – including their abject failure in some instances to confirm their borrowers’ ability to repay mortgage loans – contributed in...more

Utah Amends Residential Mortgage Licensing Laws, Exempts Underwriters from Licensing

by Ballard Spahr LLP on

Recently, the State of Utah enacted into law House Bill 332, which amends numerous provisions to Title 61, Securities-Real Estate Division. Among changes the rules make to the practice of mortgage lending and licensing, the...more

How the Great Recession Has Affected Mortgage Securitization, Servicing, and Homeownership

The house price bubble and the financial crisis exposed significant weaknesses in mortgage underwriting, the packaging of mortgage-backed securities (MBS), and the mortgage servicing industry. Over the course of the Great...more

Third Circuit Affirms Dismissal of Securities Class Action Against UBS

On September 17, the U.S. Court of Appeals for the Third Circuit affirmed the dismissal, as time-barred, of a class action brought by RMBS certificateholders against UBS over losses related to the RMBS. Filing suit in...more

The SAVE Act – Valuing Energy Savings

Consumers interested in energy-efficient homes will benefit if a recent bill, called the SAVE Act (Sensible Accounting to Value Energy), becomes law. The law, if enacted, would require Fannie Mae, Freddie Mac and the Federal...more

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