The long-standing practice of banks and mortgage lenders paying real estate brokers and homebuilders for referrals could soon be coming to an end.
Lenders are scaling back, making bold changes to or simply eliminating marketing services agreements after the Consumer Financial Protection Bureau essentially banned contracts that involve any referrals for mortgage products. Doing so, the CFPB said in a consent order last year, is a violation of anti-kickback provisions under the Real Estate Settlement Procedures Act.
At issue is the CFPB’s interpretation of a law that has been in place for 40 years.
Section 8(a) of Respa bans the charging or payment of fees in exchange for referrals of real estate services. For years, the industry got around it because of an exception in Respa that allows the payment or compensation for goods or services actually performed, even if there is a referral involved. For […]
Refinancing will come back strong in 2015, according to mortgage industry consultant Barry Habib.
His prediction relies on a contrarian view of the Federal Reserve Board’s intentions on interest rates.
The central bank will not raise rates in June, and is likely not to raise rates this year, he predicted during the Regional Conference of Mortgage Bankers Associations this week.
As a result, there will be an incredible opportunity for mortgage refinancing in 2015 as the yield on the 10-year Treasury note falls below 1.5% and rates on the 30-year fixed-rate mortgage approach 3%, he said.
Habib, the founder and CEO of MBS Highway, noted the composition of voting members of the board has changed, going from five doves, four hawks and one centrist to seven doves, two hawks and one centrist, making it less likely to take action.
Meanwhile, the dollar is getting stronger […]
Wells Fargo & Co. (WFC) and JPMorgan Chase & Co. (JPM) will pay a combined $35.7 million to settle a U.S. regulator’s allegations that their loan officers took illegal kickbacks for steering customers to a now-defunct title company.
More than 100 loan officers at Wells Fargo and six at JPMorgan accepted the improper rewards, which mostly consisted of marketing services and leads on homeowners that might want to refinance their mortgages, the Consumer Financial Protection Bureau said in a settlement filed today. One former Wells Fargo loan officer was accused of accepting cash payments from the company, Genuine Title LLC, that he tried to hide by directing them through his wife, the regulator said.
Wells Fargo agreed to pay $24 million in fines and $10.8 million to compensate customers, while JPMorgan’s payments total $900,000. Neither bank admitted or denied the allegations, which were […]
After Damien and Tina Bucci were approved for a mortgage in 2012, they decided they couldn’t afford the biggest purchase of their lives without greater confidence in the U.S. economy. Next month, they will close on their first home — a four-bedroom Colonial with a half-acre yard.
“We could have made it work two years ago but it would have stretched our budget too thin,” said Damien Bucci, 30, from the kitchen of his two-bedroom apartment in a 238-unit development in Fairless Hills, Pennsylvania. “Financially, we’re in a lot better position now.”
The Buccis have been shut out of the housing market since its rebound in 2012 from the biggest collapse since the end of World War II and now are belatedly part of its recovery. They will benefit from faster economic growth and a labor market that’s approaching what the Federal Reserve […]