Former CFPB deputy director Raj Date faced criticism last year when he departed the regulator to found mortgage lending and business advisory firm named Fenway Summer LLC. Now The New York Times has reported Date's company plans to announce a merger with Ethos Lending, allowing it to start home lending within a few months.
The combined firm will be branded Ethos Lending, The Times said, and would deal in non-QM
loans. Date said the merger would allow Fenway Summer to accelerate its timetable for entering the mortgage market.
“We had been looking for the right platform to acquire that would essentially allow us to get into the market faster and at a better scale. If we could wave a magic wand and accelerate our own entry by six months, nine months a year, what would it look like? It would look like this,” Date said.
Date's move into private business has drawn the ire of House Financial Services Chairman Jeb Henserling, R-Texas and House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., who sent a letter last year to CFPB director Richard Cordray expressing concern that Date's company would deal in mortgages that fell outside the QM rule, a rule Date helped craft. But Date has dismissed such concerns, The Times reported.
“There’s no special QM loophole written in invisible ink that only I can see. There is no secret key to the mortgage kingdom. We’re going to compete like I hope everyone does: play by the rules, make great credit decisions, deliver great customer service.”
A former CFPB official who faced criticism over the launch of his own business is preparing to enter the mortgage lending market in earnest.