What are the biggest issues in mortgage lending?

Early last week I spent some time on the West Coast mingling with the dark side. The mortgage bankers had their annual Legal and Compliance Conference which in my ever so humble opinion is a must attend for anyone deeply involved in, you guessed it, mortgage lending. I have to say the force was strong, particularly when I got to co-mingle with counsels who oversee hundreds of compliance people. But I’ve resisted its pull and now that I’ve had a week to think about it, here are my key takeaways.

How Well Do You Know Your Successors In Interest?

The biggest compliance issue by far was how to implement the successors in interest regulations which are now in effect. These new regulations call for nuanced responses depending on the type of bankruptcy a homeowner has declared the type of documents received from a relative claiming to have been willed their dead mother’s house or the terms of a divorce settlement. These are just a few examples. In concept, the regulations are simple. The CFPB understandably wants to make it easier for people to decide whether they are going to take over legal responsibility for a house they are entitled to by operational law. But converting this conceptual framework into an operational one requires well trained staff that is ready to deal with these issues on an ongoing basis.

 

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