[Alice] I guess next up is me. And so covering my segment today just in the news, I think caught my attention in the MBA news link. First of all knowing that Owen Lee spoke on behalf of our association is great. He is the chairman elect of the MBA. I’ve known Owen for a really long time, runs a great mortgage company, and so it’s good to always know we’ve had great, of course, David Kittle chairman of the Mortgage Bankers Association. So hearing that he was just recently testifying, all of you can rest assured that went well. For my segment today, I wanted to focus a little bit on what the MBA is talking about in relation to the Home Mortgage Disclosure Act. It’s a side report doesn’t get a lot of attention. I always tell people if you ever find out at your company who’s the person responsible for filing the Home Mortgage Disclosure Act report annually, just shake their hand and thank them. Lots of years of working with this reporting. It is a big deal. There are significant fines and penalties for the hundreds of data fields that we reporting and ends up being tens of thousands, if not hundreds of thousands of data fields for companies. When you file the report and definitely technology is helping, but it still all boils down to how a person entered the data at the time that the loan was originated and then again, at the time it was closed or had an adverse action to it if it was denied or withdrawn. In MBA’s go deeper section in their news link, which I encourage people to read. They created an excellent list of ways that this reporting can be approved on that they commented on comments were due by March 26th. There are times you still can send in comments after the close date of a comment period. So CFPB is who oversees this reporting process now. If you feel like you see these issues that are bulleted in MBA’s list and you go, I agree with all this. I want to send a comment, you still can send an email to the CFPB. It’s not required that they would respond to yours specifically since it wasn’t in the comment period. But if you feel strongly, you can always send messages to them. Just as a reminder we’re just a few days out from when that comment period closed, but really trying to raise the threshold so that smaller community banks don’t have to file this very cumbersome report. It has a lot of value. I will say that the idea that we have a central agency that collects the data on all the actions of the mortgage loans. This started many decades ago to actually track. Fair lending. And it really was originally about property and it’s evolved into a lot of other factors including credit score ranges and pricing. It has a lot of impact on a lender if their hum to reporting is audited. And if you make a repeated mistake, the fines are substantial. And it does get to where if you have mistakes in HMDA reports, a couple of years running, they can actually close you down for periods of time. So the penalties are very stiff. So the easing of this clearly defining what actions constitute a HMDA violation was the second bullet point that MBA raised. And I think that is a huge one that the industry has to speak out about. Because right now it’s very vague. It can vary based on auditor, it’ll vary based on region. They’re all doing comparisons of different circumstances, especially for the loans that don’t close. Those are the ones that are always the biggest exposure in this reporting. The loans that close, those were the happy customers. Everybody got their deal. It’s the loans that don’t close that need a lot more clarity on what are the consequences, because so many times it’s the borrower who backed out, but in an audit it could be looked at did we do something to discourage them? And so it walks into an awful lot of gray area. And overlap significantly with equal Credit Opportunity Act. So I’m a big advocate of some HMDA reform and thank MBA for getting a letter out there. Those of you who don’t have to deal with HMDA, actually everyone touches it. As a side note, everyone who’s involved in the mortgage process, the key strokes you are making on your computers are impacting the HMDA report. If you report the borrower’s race, sex, and ethnicity, or you don’t report it, you’re typing in their income. So many fields that a lot of people touch impact the quality of that report. So my hat’s off to the folks who file it and thank you MBA for commenting with a really great list of areas that this reporting can be improved on. So we’ll watch this to see if CFPB actually does follow up with a true proposed rule for actual changes. As a side note. Last week on last week’s show, we talked about the Department of Labor’s proposed rule on when to classify somebody as an employee and when the worker may be classified as an independent contractor. And we talked about this as it relates to loan officers and different parts of employees at mortgage companies. That comment period is open until April 28th. So if you feel compelled check in and comment by that date. That’s it for my report today. Thank you everyone.
Alice Alvey, Master CMB
She handles development of their World Class Training program designed to support UHM partners and organizational effectiveness.
Prior to UHM, Alice served as Senior Vice President at Indecomm leading the Indecomm-Mortgage U division, Internal QA and Compliance and SaaS technologies. Indecomm acquired Mortgage U in 2013, where Alice was President/Co-founder, providing training and consulting since 1996. Prior to MU she served as SVP of Operations at a national bank overseeing operations for wholesale, retail and correspondent from underwriting through servicing, and compliance.
She has been in the trenches of mortgage lending operations from application through servicing for over 30 years. Her authoring work in training content, policies and procedures and the FHA/VA Practical guides illustrates her ability to bridge regulatory requirements with day-to-day operations.
Alice has been a weekly contributor to the Lykken on Lending show since its beginning in April 2009 and has made her weekly contributions to 450+ episodes!