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CFPB Regulations on Providing Applicants With Appraisals Go Into Effect

February 6, 2014

Authors

Jerry Blanchard

CFPB Regulations on Providing Applicants With Appraisals Go Into Effect

February 6, 2014

by: Jerry Blanchard

Prior to Dodd-Frank, Section 701(e) of the Equal Credit Opportunity Act provided that a loan applicant had the right to request copies of any appraisals used in connection with his or her application for mortgage credit.  Section 1474 of Dodd-Frank amended Section 701(e) to require that lenders affirmatively provide copies of appraisals and valuations to loan applicants at no additional cost and without requiring applicants to affirmatively request such copies.

The appraisal documentation must be provided to the loan applicant in a timely manner and no later than three days prior to the loan closing unless the applicant waives the timing requirement.  The lender must provide a copy of each written appraisal or valuation at no additional cost to the applicant, though the creditor may impose a reasonable fee on the applicant to reimburse the creditor for the cost of the appraisal.

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John ReVeal and Barry Hester Continue 2013 BAI Webinar Series on CFPB Mortgage Rules on March 19

March 14, 2013

Authors

Bryan Cave

John ReVeal and Barry Hester Continue 2013 BAI Webinar Series on CFPB Mortgage Rules on March 19

March 14, 2013

by: Bryan Cave

On Tuesday, March 19 (3-4 pm Eastern), Bryan Cave attorneys John ReVeal and Barry Hester continue their 2013 webinar partnership with compliance training leader BAI Learning & Development.  This free event will build on their January 22 overview of the new CFPB mortgage regulations and will specifically explore important exemptions and ambiguities within the final Ability-to-Repay and Qualified Mortgage rules. 

Event and registration details are available here:  http://www.bai.org/bai-events/EventDetails.aspx?ec=0767 .

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Losing Good Loans to Larger Banks? Try an Interest Rate Swap

February 8, 2013

Authors

Dan Wheeler

Losing Good Loans to Larger Banks? Try an Interest Rate Swap

February 8, 2013

by: Dan Wheeler

Many community banks are reluctant to consider interest rate swaps due to perceived complexity as well as accounting and regulatory burdens. But, in a record low interest rate environment, the most desirable customers almost universally demand something that is hard for community banks to deliver: a long-term, fixed interest rate. Large banks are eager to accommodate this demand and usually do so by offering such a borrower an interest rate swap that, together with the loan facility, delivers the borrower a net long-term, fixed rate obligation and the lending bank a loan with an effective variable rate.

The alternatives to using swaps are not appealing. A community bank can limit its product offerings to only variable rate loans or short-term, fixed rate loans and thereby lose many good customers to larger competitors. The bank can offer a long-term fixed rate on the loan and then (a)

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New ECOA and Higher-Risk Mortgage Appraisal Rules Issued

January 30, 2013

Authors

Bryan Cave

New ECOA and Higher-Risk Mortgage Appraisal Rules Issued

January 30, 2013

by: Bryan Cave

As part of its recent wave of rulemaking, the CFPB issued its final rule implementing a Dodd-Frank amendment to the Equal Credit Opportunity Act (ECOA) on January 18, 2013. Under the new rule, lenders must automatically provide copies of any written appraisal reports and valuations developed in connection with an application for credit that is to be secured by a first lien on a dwelling. The current version of this rule only requires this disclosure upon an applicant’s request, although it applies to junior lien credit applications, as well. The new rule takes effect January 18, 2014. As it does now, and as the ECOA does generally, the rule will be equally applicable to business and consumer credit applications.

On the same day, the CFPB and five other financial regulatory agencies

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The CFPB’s New Mortgage Rules: Themes and Responses

January 21, 2013

Authors

Bryan Cave

The CFPB’s New Mortgage Rules: Themes and Responses

January 21, 2013

by: Bryan Cave

One can’t fault the CFPB’s production level in the past two weeks.  Since January 10, the Bureau has issued seven distinct final rules – the lion’s share of what it considers “a single, comprehensive undertaking” to implement Dodd-Frank mortgage reforms.  By our count, this work includes over 3,100 pages of rulemaking text not to mention the press releases and the various summary materials and social media campaigns.  Final rules were issued on the following:

As a reminder, we’ll provide an overview of these rules and

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Bryan Cave Attorneys To Present January 22 Webinar on New CFPB Mortgage Rules through BAI Learning & Development

January 16, 2013

Authors

Bryan Cave

Bryan Cave Attorneys To Present January 22 Webinar on New CFPB Mortgage Rules through BAI Learning & Development

January 16, 2013

by: Bryan Cave

The CFPB continues to finalize a high volume of new mortgage rules required by Dodd-Frank.  Join compliance training leader BAI Learning & Development and Bryan Cave attorneys John ReVeal and Barry Hester as they provide an overview of final Qualified Mortgage and Ability-to-Repay rules and other new and proposed requirements.  This informative webinar will be offered on Tuesday, January 22, from 3-4 pm Eastern.

Here’s also a recent bulletin John and Barry developed on some of these new rules.

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Board Oversight of the Compliance Function: Coaching Fundamentals

January 7, 2013

Authors

Bryan Cave

Board Oversight of the Compliance Function: Coaching Fundamentals

January 7, 2013

by: Bryan Cave

Despite all that has been made of Dodd-Frank, the new Consumer Financial Protection Bureau, and the increased focus on consumer compliance throughout the banking industry, we think that the fundamental formula for effective board oversight of the compliance function has not materially changed. We encourage directors to take stock to make sure their bank’s program is adequate. In this season of great contests on the gridiron, we would emphasize that blocking and tackling—and defense generally—remain the keys to success in this area. Be a good coach and make sure that these fundamentals are practiced at your bank.

Bank Regulatory Expectations

We start with the black-letter guidance and then read between the lines based on our experience and judgment. Each of the prudential bank regulators has outlined its expectations for board oversight of the compliance function. Although it’s stated

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Financial Services Update – September 16, 2011

September 18, 2011

Authors

Matt Jessee

Financial Services Update – September 16, 2011

September 18, 2011

by: Matt Jessee

Geithner Meets with Eurozone Finance Ministers

On Friday, Treasury Secretary Timothy Geithner met with seventeen European finance ministers in Poland to discuss the eurozone’s debt crisis. Jean-Claude Juncker, president of the Eurogroup, announced the group decided to delay till October a decision on whether to pay out the next tranche of a multi-billion euro loan to Greece. The two-day meeting of Europe’s Economic and Financial Affairs (ECOFIN) Council — hosted by Polish Finance Minister Jacek Rostowski and the president of the National Bank of Poland — comes ahead of G20 and IMF meetings later this month. The European Central Bank, along with the Fed, the Bank of England, the Bank of Japan and the Swiss National Bank, also announced that three U.S. dollar auctions would be held between October and December.

Senate Committee Passes Increased Funding for SEC and CFTC

On Thursday, the Senate Appropriations Financial Services Subcommittee passed its

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Financial Services Update – July 22, 2011

July 22, 2011

Authors

Matt Jessee

Financial Services Update – July 22, 2011

July 22, 2011

by: Matt Jessee

Debt Limit Negotiations Continue

On Tuesday, the House passed its “Cut, Cap and Balance” legislation which would cut government spending now, cap it in the future and approve a constitutional amendment to balance the federal budget. On Friday, the Senate voted to table a motion to consider the measure. However, after another tense week of negotiations between the Senate Republicans, Senate Democrats, House Republicans, House Democrats, and the President Obama, the outline of a purported deal seemed to emerge late Thursday. Congressional Democrats reported that President Obama discussed with them a deal he had reached with Speaker John Boehner to raise the debt ceiling by $2.4 trillion, enough to get through the 2012 elections, with at least as much in immediate spending cuts and a promise of  “tax reform”  in 2012. On Friday, in response to the news of a “deal,” Speaker Boehner told the House Republican Conference there was

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Financial Services Update – April 8, 2011

April 9, 2011

Authors

Matt Jessee

Financial Services Update – April 8, 2011

April 9, 2011

by: Matt Jessee

European Central Bank Announces Interest Rate Hike; Portugal Bailout Next

On Thursday, Jean-Claude Trichet, European Central Bank president, announced a 25 basis point rise in eurozone borrowing costs, to 1.25 percent. This will be the first of such an increase since the 2008 financial crisis. In response to the news, the euro initially dipped against the dollar but later appreciated to trade above $1.43. In his remarks, Trichet also said the ECB had encouraged Portugal to request an international bailout, which is estimated at 80 billion euros, roughly the same amount as Ireland but less than the 110 billion euro package offered to Greece. EU, European Central Bank and International Monetary Fund officials will meet in Lisbon next week to negotiate the cuts that are deeper than those that were rejected by Portuguese opposition politicians last month.

SEC Reviews Private Company Share Rules

On Wednesday, SEC Chairman Mary Schapiro sent

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