Mortgage Software Solutions Blog

2018 Changes in Banking Technology Part II

blog pic 3Finance customers turn to mobile banking technology.

New technology continues to change the banking landscape.

For mortgage lenders, finance technology or “fintech” startups are competing to attract lending clients.

Smartphone-obsessed customers are more mobile than ever and the number of banking platforms has exploded. With 46% of consumers using only digital channels for their banking, the way that customers handle their finances is taking a huge shift.

Here are 3 more ways that new technology is changing the banking industry in 2018.

  1. Cybersecurity

Cybersecurity in the financial industry is experiencing a worldwide crackdown in response to infamous missteps in 2017.

Last year was rough. Large businesses from Uber to Equifax came clean with the public about record-breaking customer data breaches.

As a result, new regulations concerning finance-related cybersecurity have made it onto the books in the United States, Europe, and the United Kingdom. Stricter regulations even include naming and shaming in the public forum. For example, starting in 2018 the Financial Conduct Authority requires UK banks to publish data on how many complaints and security breaches they have encountered throughout the year.

Formerly held accountable by regulatory bodies within the banking industry, now financial institutions will be facing not only federal law but public opinion. With leaders like the EU, the UK, and the US taking the lead, other world markets are sure to follow.

High-tech options in identification and recognition are hitting the market as a way to shore up security. Biometric security and voice verification software are in development and beta testing. The new measuring stick for basic security begins at multi-factor authentication.

Mortgage lenders at any level would be smart to take notice and sort out their cybersecurity issues. The only other option is to risk having their name added to the growing list of internationally untrustworthy companies in the eyes of consumers.

  1. Mobile Investing

Another new technology on the market takes investment consultations out of the local branch and drops it right into the investor’s pocket.

A full 82% of 18 to 24-year-old smartphone owners say they use mobile banking exclusively. 

Feeding the demand for putting banking applications onto mobile devices like smartphones and tablets, fintech is making lending and investing more accessible than ever.

This new wave of mobile finance is letting millennial do-it-yourselfers have all the control by using plain language and visuals to explain financial terms. Bankers are replaced by explanatory screens and animations. Investment apps even let new customers dip their toes in the investing game by allowing customers to have a “practice run” before dealing with actual money.

Small-scale investment companies are reshaping the barriers to entry by allowing new investors to get in the game for as little as £250 in the UK. These game changers are coming about due to aims of open banking legislation strategies for reducing monopolies.

This new family of mobile investing apps offers greater control than traditional banks over their mobile-based portfolios, even allowing customers to pick and choose investment baskets based on trending labels like “socially responsible tech”.

  1. New Technologies

Beyond cybersecurity and innovation in mobile investing technology, there is a host of newly-developed niche finance technologies hitting the market.

Robo investing automates the risk appetite assessment process.

Full integration of voice assistants are popping up. Capital One partner Alexa can now tell customers their account balances and spending habits after a night out.

Though historically skeptical towards bitcoin and cryptocurrency, credit giant Mastercard changed their tune in 2018 and announced open support for virtual currency in the Asian-Pacific market.

It’s too early to predict which of these new technologies will have staying power and which ones just won’t stick, but they all have one thing in common. They all work on the basis of a hybrid platform that combines human and computer-based tools to carry out financial services.

These new integrations of technology into the banking world are already changing the way that consumers approach banking.

With 2018 is primed to be the year that tech saturates the finance industry, mortgage lenders and other traditional finance institutions have no choice but to take notice.

Join us at the cutting edge of technology with regulation-compliant cyber security, remote device access, and more. ABT equips mortgage lenders with the tools for success in a digital world.

Image: Unsplash

Topics: mortgage regulations mobile technology mortgage industry partnerships Consumer Finance Protection Bureau Compliance for Mortgage Companies Compliance Audit job opportunity Trump Administration Mortgage Lending

What Technology Is Changing In Banking For 2018

blog pic 4In the future, financial information and programming will be increasingly available on-the-go.

The old days of purely brick-and-mortar banks are over.

Mobile banking is the preferred platform as global smartphone use skyrockets and our preference for handheld interaction grows.

In 2011 only 10% of the world’s population used a smartphone. By 2018, that number has reached over 36% penetration.

From traditional commercial banks to finance technology or “fintech” startups, the banking industry is competing in an all-out sprint towards digital progress.

Here are 4 ways that technology is changing the banking industry in 2018.

  1. Open Banking

Open banking is a phenomenon being pushed by regulatory bodies around the world.

Lawmakers in the EU, UK, and the US have all passed legislation that takes personal financial data out of the hands of the banks and returns control to consumers.

The EU’s Payment Services Directives (PSD 2007 and PSD2 2015) will be fully implemented this year.

Together the PSDs regulate financial service providers by requiring transparency about consumer rights and the banks’ obligations to the public. They also require banks to free up customer data for third party access, limiting the power of the bank that gathered it.

The EU regulations coincide with the “Open Banking revolution” in the United Kingdom that intends to make banking more competitive for increased consumer protection. The UK also made it mandatory for all banks to provide third-party access to customer financial data using open API technology at the start of 2018.

In the wake of the Equifax data breach on the other side of the Atlantic, the United States made their move towards stricter regulations beginning in 2017 with the state of New York. US laws are focused on cybersecurity and consumer protection via speedy cyber attack reporting and increased government oversight of consumer data mishandling.

The proximity of these launch dates mean that traditional banks around the world face new technology-based limitations. Open banking and cyber security requirements leave the door open for tech-savvy challengers with a spotless reputation for safeguarding the public.

  1. RegTech

Another technology changing global banking in 2018 is regulation technology or “RegTech”.

RegTech is the umbrella term for software tools specifically designed to streamline regulatory compliance.

In the EU, RegTech has been using guidelines from the 2004 and 2011 Markets in Financial Instruments Directives (MiFID) as well as the General Data Protection Regulation (GDPR) of 2014.

Newly developed RegTech takes new 2018 regulations into account and eliminates duplication issues and insufficient data storage signposting.

Due to increased regulation, the adoption of these programs across the industry will determine which finance organizations move ahead and which ones get stuck hitting every legal bump in the road.

If implemented well, RegTech has the potential to significantly reduce risk, speed up compliance management, and control bank costs despite increased accountability.

  1. Robo Advice

“Robo advice” is the term for technology that does traditionally human jobs in investment banking.

In the past, investment managers evaluated a customer’s financial situation, communicated investment options, assessed risk appetite, handled portfolios according to client preferences, and relayed information about performance back to the investor.

Robo advice is the software and algorithms that provide these services digitally and accessibly on mobile devices like smartphones and tablets.

Millennials aged 22-37 prefer to work with apps and digital information over commercial banks. The demographic has a do-it-yourself attitude and shows an aversion to traditional banking institutions that have steered them into crushing student debt.

In fact, 75% of American millennials report trusting a financial product from a fintech company. Almost half of millennials in the US with investments report being aware of robo-advisors, while a full 11% currently use a robo-advisor exclusively.

With a frictionless user experience, robo advice may become the new norm.

  1. New Technology

In the UK, financial services newcomers are edging out traditional banks. Startup lenders like Iwoca in the UK are touted as the “future of small business lending” by using software algorithms to make credit decisions and having quick loan turnaround thanks to fintech.

By using all-digital or hybrid platforms combining human and algorithmic tools to reach customers, other digitally-native finance startups are slated to follow their lead.

Whether it’s anti-monopoly Open Banking APIs, intelligent RegTech software to handle compliance, or the growing preference for robo advice over human interaction, technology is making huge waves in the global banking industry this year.

As the digitally-native generations grow, traditional financial institutions scramble to expand their digital offerings while fintech startups flourish and join the market.

Join us at the cutting edge of technology with regulation-compliant cyber security, remote device access, and more. ABT equips mortgage lenders with the tools for success in a digital world.

Image: Visual Hunt

Topics: millennials cloud storage mortgage business mortgage regulations mobile technology mortgage industry Consumer Finance Protection Bureau Compliance Audit job opportunity cloud-based data Trump Administration Housing Market Mortgage Lending

4 Reasons to Implement a Mortgage Business Intelligence Strategy

bim.jpgBI visuals help employees in the company get on the same page.

Business Intelligence (BI) has come a long way since its first implementation.

At its most basic, BI has always involved analyzing reports and performance information to allow companies to make decisions based on past activity.

At the complex level of present-day information gathering, BI handles large amounts of unstructured, seeming unrelated data and then makes utilitarian connections between data points.

Using modern BI, a company can turn information sets into successful business strategies that give them the edge on the market and long-term stability over their competitors. Nowadays companies even have access to industry-specific BI tools.

Can you imagine why the mortgage industry should harness this ability? Here are 4 reasons to implement a Business Intelligence Strategy in your mortgage company.

  1. Integrated BI for Complete Data

By integrating business intelligence, a mortgage company has the ability to gather data on their activity via an existing mortgage enterprise management system (EMS) and then work with that data using the BI module.

With two or more applications communicating seamlessly, administrators have all the company information at their fingertips.

Integrating BI with existing tools like EMS and CRM platforms makes the data sets more ample and complete.

  1. Improved Strategic Awareness

Integrated Mortgage BI goes beyond just connecting platforms. It develops a rich business intelligence data warehouse (BIDW) that forms the basis for future decisions.

The BI module has the capacity of building data model visuals that are easy to understand. Using the full range of information available, this feature processes information to make it actionable. Pulling information from all sources means providing the company with rich prescriptive and predictive analytics output.

The strategy of information awareness and fact-based decisions produces a positive influence on the bottom line.

  1. BI Accessibility Breeds Positive Change

It used to be that companies needed IT analysts to interface with the data and come up with insight. It was a management level activity shared between tech folks and decision makers in the company.

With an industry-specific BI strategy in place, everyday users in a mortgage company can view easy-to-understand level-specific data related to their work. Placing BI in employee dashboards empowers them to make informed decisions. It goes beyond IT data and links up with HR, employee metrics, customized dashboards, and more to give the power of data to employees at every level of the company.

Smart decisions go from being seen as top-down directives to using real information as the basis for decisions company-wide. This change in company culture has the benefit of increasing employee job satisfaction and efficiency, which also affects the bottom line.

  1. Industry-Specific Bi is Affordable

There are plenty of BI applications on the market. From Tableau to Microsoft, the tech industry has developed a plethora of BI platforms with a range of executions.

There are also visionary platforms like Salesforce that are extremely flexible but require in-house IT customization. They come with bells and whistles that aren’t meant for the mortgage industry.

Mortgage companies without the resources to create their own fit have a better option. Industry-specific software with ample performance ability is the sweet spot. A mortgage-specific BI tool like this is the most affordable choice.

Mortgage companies who implement this type of “goldilocks” platform will be able to harness the power of BI quickly and easily.

Mortgage BI, developed by the same Northern California-based company that produces the data-sharing software MortgageExchange™, is a perfect example of this type of “goldilocks” platform.

ABT’s takes Microsoft’s Power BI software and their own MortgageExchange and combines them for a leading example of how companies can harness the big-brand power of BI without being oversized or overpriced. Not too expensive, no surplus of addons, and customized to be just right for the finance industry.

BI offers huge improvements to every modern mortgage company’s business strategy. The improved strategic awareness will save your company from financial missteps and BI-generated visual representations of performance data will put employees on the same page across the company.

With BI implementation, companies can efficiently put their data to work and move forward with clear direction.

Contact ABT directly to learn about Mortgage BI business analytics for your bank, credit union, or mortgage company.


Topics: Cloud Services information security for mortgage companies data interface solution data security mortgage software integration Business Intelligence Mortgage BI security productivity mortgage business mortgage regulations mobile technology mortgage industry

Guide to New York’s Cybersecurity Regulations

The deadline is less than a month away.

As February 15, 2018 draws near, financial institutions in the state of New York are scrambling to comply with cybersecurity regulations that are new to the industry and unprecedented in the state.

Released in early March of last year, Part 500 of Title 23 or Cybersecurity Requirements for Financial Services Companies (2017) is a 14-page document detailing how finance companies will be legally required to protect nonpublic information in their computer systems.

These regulations were implemented by the Department of Financial Services (DFS) citing security risks and the “ever-growing threat” of foreign nation-states, terrorist organizations and cybercriminals. The DFS Superintendent’s office will be overseeing compliance with the new laws aimed at safeguarding sensitive information that banks, credit unions, and mortgage companies keep on file.

As the zero hour approaches, here is a quick guide to the new DFS directives.

Cybersecurity Programs for All 

The main requirement is that all financial institutions under the regulation of the DFS are now required to create and implement a written cybersecurity program. 240_F_41316834_khRM1Linm358EZL0uiTOmQS2tyeankBN.jpg

With computer-based leaks making national headlines, New York’s banks will be held to a high standard.

The main issue of information leaks is “nonpublic information” or data gathered about customers and clients that is not meant for public knowledge. This includes business information, identifying information, account numbers, and even medical information.

A “cybersecurity event” is any action or attempt of unauthorized access to this information.

Security Measures

The new DFS regulations specifically call for annual penetration testing and bi-annual vulnerability checks of all information systems.

This includes extensive recordkeeping of system activity. Each financial institution must keep transaction records for a period of 5 years and an audit trail that records at least 3 years of activity.

The DFS further urges permissions control for all software applications.

Policy Requirements

This new cybersecurity program that every institution must implement is subject to oversight. The regulations require that all policies be recorded and approved by a senior officer or the company’s board of directors.

The guidelines state that any policies laid down must address an extensive list of 14 distinct topics ranging from data governance to disaster recovery planning.

Beyond stating the goals of these new measures, the law requires that companies designate a Chief Information Security Officer (CISO) for in-house enforcement.

This individual is required to report in writing annually about security to the company’s board and will be held responsible in the event of a breach at the agency.

Risk Assessment

Beyond coming up with a plan, the new regulations require action.

Financial institutions must run a complete risk assessment of their company. The assessment must be documented and it should include an evaluation of the adequacy of the existing access controls.

By law, this assessment must be carried out by qualified cybersecurity personnel. To avoid passing the buck, companies who hire out for the job must still exercise due diligence in evaluating the adequacy of the third party’s own security practices.

The law makes it clear that the financial institution itself will be held responsible for the integrity of their new program.

Other Regulations

There is a host of supplementary details in the document that outline currently-held security precautions across the information systems industry.

For example, multi-factor authentication for network access, a time limit on data retention, and regular cybersecurity awareness training for all personnel are all part of the regulation.

Encryption guidelines are spelled out and become subject to annual review by the CISO.


The final issue addressed by the new regulation involves communication with DFS. The superintendent’s office places a strict time cap on security breach announcements. A company has no more than 72 hours to report any event that has a “reasonable likelihood of materially harming the normal operations” of the company. 

Serious events like this have always fallen under reporting laws to local supervisory bodies. Under the new law, these events will be taken up the chain of command to the Superintendent’s office immediately.  

As of last year, New York is taking cybersecurity seriously. With such strict laws, it’s understandable that financial institutions have been slow to enact changes. After the year-long cushion, the new regulations are set to be enforced and financial institutions will be held responsible if they don’t comply.

14 pages of detailed requirements are on the books. As the transition year comes to an end, banks, mortgage companies, and credit unions are under the gun to make it happen.

Are you a CIO?

Has your institution taken the proper steps for system security?

For comprehensive compliance guidance and other cybersecurity solutions and, contact us.

Topics: DocumentGuardian cloud storage mortgage business mortgage regulations Compliance Audit Mortgage Lending DFS 23 NYCRR Part 500 NYSDFS

Mastering Regulatory Examination Preparation for Mortgage Businesses

Regulatory-Examination-Preparation.jpgWhen faced with a regulatory examination, many mortgage businesses simply freeze up and ignore what’s coming, often because they’re not sure what to do. But a regulatory compliance audit is not the time to bury your head in the sand. Rather, it’s an opportunity to demonstrate your mortgage business’s commitment to its customers and to regulatory compliance as a whole.

Let's start with a few basics about CFPB regulatory examination preparation for mortgage businesses and what you need to do get ready.

Non-Depository Institution Examinations

The Consumer Financial Protection Bureau (CFPB) identifies non-depository institutions for examination based on asset size, consumer financial transaction volume, and rigorousness of state oversight and state regulators.

Depository Institution Examinations

The CFPB identifies large institutions for examination based on its assessment of consumer risk and consistency with statutory guidelines on coordination of examinations.

What Does a CFPB Examination Look for?

The CFPB searches for evidence of unfair, deceptive, or abusive acts or practices, discrimination, and other legal violations.

  • Examiners review compliance procedures and policies that keep an organization in line with statutory and regulatory policies.
  • Examiners decide whether to take formal enforcement actions or informal corrective actions.
  • Examiners issue a draft compliance report that they share with the organization under review.
  • CFPB encourages self-correction, but more egregious violations will require formal enforcement action.

What is a Targeted Review?

There are times when the CFPB becomes aware of violations through citizens’ complaints of certain problems at a single organization. In this instance, the CFPB will conduct a review of that single organization, focusing on the problems that gave rise to the consumer complaints.

What is a Horizontal Review?

Horizontal reviews examine multiple organizations within the industry to investigate certain practices or even products that violate consumer protections and to decide whether formal enforcement is appropriate.

What Does CFPB Enforcement Mean?

The CFPB may enforce legal actions or civil actions in a Federal district court. The CFPB may seek equitable relief, such as:

  • Rescission/reformation of contracts
  • Refund of money or real property
  • Restitution, disgorgement, or unjust enrichment relief
  • Monetary damages
  • Public Notices issued about violations
  • Limitations on activities and job functions against the person to whom the CFPB brings an action
  • Civil penalties earmarked for victim compensation or education

The CFPB cannot bring criminal enforcement charges. If the CFPB finds evidence of criminal activity, or evidence of discrimination, the law requires that the agency turn over the evidence to the Department of Justice. If the agency finds evidence of tax law violations, the law requires it turn over such information to the IRS. Examples of criminal activity include false data, conducting business with a foreign country with active US sanctions, bank deposits in such sanctioned countries, and false information on applications.

What Can I do to Prepare for a CFPB Audit?

As intimidating as the examination process may sound, there are things you can do to make the process go smoothly.

    • Prepare yourself. The CFPB will send a letter outlining what they intend to review. The CFPB website is full of information on enforcement, recent enforcement actions, and examination guidelines and objectives.

    • Consider pre-examination in-house mock reviews. These practice sessions can help prepare the team's response to audit questions as well as help identify and focus on issues that the legal team should review.

    • Appoint a single person responsible for contact with CFPB examiners. This is the "go-to" person for all examination contact, including setting up meetings, advising stakeholders/legal department of the focus of the audit, gathering the materials for review, and setting up the protocols for handling the examination itself.

    • Give the examiners room (preferably a conference room) with the equipment and tools they need to do their job. Place them close to the legal department or compliance people. Present the documents the audit letter said they require in labeled file folders, all neat and tidy on the conference table. You will appear organized, and they won't go on a fishing expedition for documents.

    • Start engaged, stay engaged. Make a good first impression. Provide background information for examiners on your business model and your enforcement policies. Invite the right people to the meetings.

    • Impress examiners with your information organization skills. Set up websites that contain the examination information you received from the CFPB.

    • Consult with the legal department before self-identifying compliance issues.

    • Don't underestimate the amount of time required to spend with the auditors. It behooves an organization to open the primary contact person's schedule so he or she is free to answer all questions from the examiners. Some examiners are less experienced with your industry. The audit is a great teaching moment for you to leave less experienced examiners with a positive impression of your organization and a great understanding of your industry.

    • Non-bank lender audits differ from depository institution audits. If you service loans, they will review your service processes. If you have affiliates, the CFPB will look at those, too. Remember that the CFPB will do its homework on your company from the past several years (including reviews of any state audits), so you should adequately prepare to answer their questions.

While the process may cause stress, remember that the auditors are not on an expedition against your organization. Throughout the examination, stay hospitable. Examiners often travel to your business from out of town. Let them know where they can find places to eat or to take a nice walk after lunch.

Access Business Technologies is a certified SSAE 16 Type II cloud solution provider (CSP) to over 500 mortgage financial institutions (banks, credit unions, and mortgage companies). Our suite of mortgage-specific cloud solutions enables your organization to move through the audit process with ease. To talk more about CFPB regulations or other mortgage compliance issues, please contact us. We look forward to helping you grow your mortgage business.

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Topics: mortgage regulations examination preparation

Understanding TRID and What it Means for the Mortgage Industry

TRID-and-the-mortgage-industry.jpgYou may know a bit about TRID and what it means for the mortgage industry, but how much do you really know? We've found a few things that everyone should know about it. Let's start with a few basics for better understanding TRID.

What is TRID?

TRID is an acronym for the TILA-RESPA Integrated Disclosure rule. TRID became law as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank). Sections 1098 and 1100A of Dodd-Frank required the appropriate rulemaking agency to publish revised forms and rules that require the mortgage industry to combine the disclosure information that consumers receive when they apply for and close on a mortgage under the Truth in Lending Act (TILA) with the settlement disclosures under the Real Estate Settlement Procedures Act (RESPA).

What Agency Writes the Rules for TRID?

The Consumer Financial Protection Bureau (known more familiarly as the CFPB) has rulemaking authority over TRID. On November 20, 2013, CFPB released 1,900 pages that comprised the final rule on TRID. The rule was effective for mortgage applications received on and after August 15, 2015.

There's another proposed rule due out in April 2017 that will clarify a few issues. When the CFPB's comment period on the new proposed rule closed in October 2016, they had received 1500 comments.

What Are the New Forms?

The final rule mandates two disclosure forms:

  • The Loan Estimate, which blends the RESPA Good Faith Estimate with TILA provisions
  • The Closing Disclosure, which integrates the TIL and the HUD settlement statement.

The Loan Estimate provides a summary of estimated loan terms, loan and closing costs, and disclosures. As its name implies, the Closing Disclosure provides a summary of the actual loan terms, loan and closing costs, and other disclosures.

Compliance with the TRID rules and CFPB regulations is a major challenge for the mortgage industry. The final rule applies to most closed-end mortgages but does not apply to mobile home mortgages, home equity lines of credit, reverse mortgages, or to creditors who close five or fewer loans in a year. That last is the final rule's only exception for small creditors.  

The final rule also made significant changes to RESPA and TILA, which are outside the scope of this post.

TRID's Biggest Changes

The biggest change for consumers is that, under the new rules, they will receive closing information at least 3 days before their settlement date. That change gives them more time to review and understand the financial disclosures before they go to settlement. If they do not understand something on the disclosure forms, they will have ample opportunity to ask questions before the big event.

The biggest change for the mortgage industry is that the lender now is responsible to prepare the consumer's settlement forms. In the past, the title company completed the HUD forms and gave them to the lender for review, but the responsibility for the disclosure forms was always with the title company. This change disrupts mortgage companies’ internal processes as loan officers struggle to absorb this responsibility into their procedures. The change in rules will require new deadlines for the new forms.

CFPB anticipates that new rules will make settlements run more smoothly and that fewer errors will occur.

Other Changes to the Mortgage Process

The new disclosure forms are not the only changes to the mortgage process. The final rule changes the application definition, tightens the ability to increase costs throughout the mortgage process, and adds the three-day waiting period that runs from the date the consumer receives the disclosure information up until the settlement date. If the lender modifies the disclosure information, then another three-day waiting period applies before the consumer can go to settlement.

As you can imagine, these disruptions and system modifications are expensive, and the consumer will ultimately bear the brunt of these costs.

A Final Word About Fannie Mae and Freddie Mac and HUD

It is unclear how these government entities will address TRID. If they take a conservative approach to their quality procedures, and repurchase and claims procedures, the disruption may cause a sizeable market upheaval.

At Access Business Technologies, we provide mortgage businesses with the tools they need for comprehensive document management, security compliance, and proper regulatory alignment. To learn more about our suite of cloud services, please contact us.


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Topics: mortgage regulations TRID

The History of the CFPB and Its Future Post-Election

History-of-the-CFPB.jpgThe Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) authorized the consumer protection bureau known familiarly as the CFPB. The CFPB was born as a result of the financial abuses that led to the Great Recession of 2007-2008. There are early signs that the consumer protection agency is on the congressional radar for some tinkering, if not outright repeal, so this seems a good time to review the history of the CFPB and what the future holds.

What Is the CFPB and How Was it Born?

The CFPB is the acronym for the Consumer Financial Protection Bureau. The Dodd-Frank law authorized the bureau as an independent agency. However, in 2016 the federal appeals court in PHH Corp. v. Consumer Financial Protection Bureau, 15-1177, U.S. Court of Appeals, District of Columbia Circuit (Washington) determined that the law had unconstitutionally limited the President's power to remove the director, so it is now an executive-level agency.

What is the CFPB's Jurisdiction?

The CFPB has broad jurisdiction over banks, credit unions, securities firms, payday lenders, mortgage services, foreclosure relief, debt collectors, and other US financial companies. Director Cordray lists the agency's priorities as mortgages, credit cards, and student loans.

CFPB writes and enforces regulations for banks and other financial institutions, examines banks and other institutions, reports on markets, and collects and tracks consumer complaints. CFPB also works with state regulators to enforce consumer protection rules.

CFPB Accomplishments

Here are a few of the CFPB’s most prominent accomplishments:

  • In 2013, CFPB set new standards for mortgages that include verifying income, verifying ability to pay back the loan, and preventing exotic loans (such as the low teaser interest rates that bloomed as one of the abuses of the financial crisis when they reset to high rates).
  • In 2015, CFPB changed the disclosures borrowers receive to make it easier to compare mortgage terms. Critics, however, charge that the new mortgage rules accept more risk than many would like to see.

Perhaps the CFPB's most visible accomplishments have come in the enforcement area.

  • The agency's website says that it has levied $11.7 billion in penalties and forgiven debts that it scored for 27 million consumers.
  • The CFPB took on big lenders like Citibank and Bank of America for misleading consumers. CFPB forced Citibank to pay back customers $700 million in misleading add-ons and $720 million from Bank of America.
  • In September of 2016, CFPB levied fines against Wells Fargo to the amount of $100 million for the unauthorized (and illegal) opening of credit accounts, as a result of bank incentives to its employees.

Battles Still Waiting

CFPB scored high-profile victories in the mortgage arena, but there are battles on the to-do list that have not yet been waged.

  • There have been no changes yet in the abusive practices by payday lenders.
  • CFPB has also targeted arbitration clauses that make it hard for consumers to join class action suits.
  • Another area in which the agency wants to take action is limiting bank late fees, which reportedly took $32 billion from consumers in 2015.

A Glimpse Into the Future of the CFPB

Ever since its inception, there have been members of Congress who have wanted to kill the CFPB. Observers split on the outlook for the future of the agency:

  • The worst case scenario: CFPB faces a 50-50 chance of surviving (or of being destroyed).
  • The best case scenario: The agency faces a revamp.

The good news is that the CFPB probably isn't high on the list of changes the new administration wants to work on immediately. So it may take a while before Congress sets its sights on the CFPB, and when it does, it will most likely target the structure of the organization.

Still, consumers are at risk of losing some protections. Issues that Congress could meddle with include ending financial institutions reporting quarterly to CFPB, easing payday lender restrictions, easing truth-in-lending disclosure, or less oversight on pre-paid debit cards.

One thing Congress will have to consider is that the agency has a track record of helping and protecting consumers, which will make it hard politically to dismantle altogether. The high-profile Wells Fargo case was good press for the CFPB and played well with consumers.

To learn more about the Wells Fargo case, read the article entitled "Consumer Financial Protection Bureau Fines Wells Fargo $100 Million for Widespread Illegal Practice of Secretly Opening Unauthorized Accounts".

To talk more about the CFPB or how your mortgage business can more easily maintain compliance with CFPB regulations, please contact us. MortgageWorkSpace® and our suite of cloud hosted services can help protect and grow your business.

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Topics: CFPB mortgage regulations