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Mortgage Compliance DailyRecent compliance activity

March 9, 2009

By staff

As fast as new requirements emerge for government lending and appraisal ordering, new services are emerging to help mortgage companies comply. In other compliance news, mortgage trade groups are asking the Obama administration to exempt mortgage servicers from upcoming licensing requirements.Seven trade groups — including the American Bankers Association, the Consumer Mortgage Coalition and the Mortgage Bankers Association — issued a joint letter to U.S. Department of and Housing and Urban Development Secretary Shaun Donovan asking that mortgage servicers be exempt from the Secure and Fair Enforcement for Mortgage Licensing Act of 2008. The groups, concerned with a potential patchwork of state laws that could emerge requiring servicers to obtain state licensing, want the housing agency to clarify that S.A.F.E. doesn’t apply to servicers.

“While we support appropriate qualifications for mortgage servicing companies, we do not believe the S.A.F.E. licensing and registry system is the appropriate vehicle to address any servicer-related concerns,” the groups said. “We strongly urge that HUD publicly take the position that servicers, who work with consumers concerning existing loans, are not subject to S.A.F.E. and should not be subject to state licensing requirements under S.A.F.E.”

MBA issued a separate letter to U.S. Department of the Treasury Secretary Timothy F. Geithner said that the S.A.F.E. act, which encourages states to enact licensing and registration laws for lenders and mortgage brokers by July 30, may lead to unnecessary regulation that may impair loan modification efforts.

In its own letter to Donovan, the Consumer Mortgage Coalition highlighted issues caused by the lack of coordination between HUD on the Real Estate Settlement Practices Act and the Federal Reserve on the Truth in Lending Act. The group asked Donovan to delay implementation of compliance with new RESPA regulation until Jan. 1, 2010.

FNC Inc. recently issued a statement indicating that mortgage originators should immediately implement changes to their systems and operations to meet the May 1 deadline to comply with the new Home Valuation Code of Conduct. Under the code, Fannie Mae or Freddie Mac can demand that a seller repurchase noncompliant loans.

“They may not be fully aware that their systems and processes will require significant changes to avoid penalties associated with selling their new originations to the GSEs after May 1,” FNC’s designated HVCC expert Jon Fisher said in the statement.

FNC said its platforms ensure HVCC compliance utilizing auto-assignment-functionality that ensures appraiser independence while limiting orders to appraisal firms on the lender’s approved vendor list. The system also uses a non-biased rules engine.

A fully automated analysis from Interthinx helps mortgage companies avoid mistakes on loans insured by the Federal Housing Administration, a recent press release said. Dubbed PredProtect, the service alerts loan processors when excessive fees are found. The system also issues a warning when tax-service fees or loan-origination fees exceed 1 percent, in accordance with HUD Mortgagee Letter ML 2006-04.

Members of the National Association of Mortgage Brokers now have fully sponsored access to AllRegs’ federal compliance and pending legislation through AllRegs Online. NAMB said it is the only mortgage trade group that includes the service in its membership features.

Employees of financial institutions can receive more than 160 online compliance training utilizing’s LearnCenter online training platform, Wolters Kluwer Financial Services announced today. The one-stop shop includes web-based skill development, content and development plan management.

Wolters Kluwer announced last month that senior compliance consultants Pat Ditlevson and Kevin Whalen earned their Certified Regulatory Compliance Manager designation from the American Bankers Association’s Institute of Certified Bankers.

U.S. Bancorp will utilize Compliance Express — an online licensing and compliance service, Sircon Corp. said in a recent press release.

LenderLive Network Inc. reported last month an increase in customer demand for its quality control services at its contract services division.

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