The CFPB is working with state regulators to ensure they properly enforce new industry rules
Although states currently regulate mortgage loan originators, the Consumer Financial Protection Bureau will be working alongside them to ensure they properly enforce new mortgage rules and regulations, several mortgage professionals explained.
The CFPB is syncing-up with state regulators to ensure that all types of originators, including brokers, have proper compliance management systems set up, according to Alan J. Cicchetti, director of agency relations at Lenders Compliance Group, an outsourced compliance provider in Connecticut. He was the former deputy commissioner and former acting director for the consumer credit division for the Connecticut Department of Banking.
The introduction of the CFPB has caused a “level of examination that is unprecedented,” he said. Originators of all sizes, including independent brokers, should have a system in place that standardizes its policies and procedures, should an audit or examination take place.
More sources of information are coming available to regulators, said Cichetti. CFPB’s new consumer complaint portal and the National Mortgage Licensing System’s quarterly mortgage call reports could spark a regulatory scrutiny.
Clem Ziroli, president of First Mortgage Corporation, a mortgage lender in Ontario, California, said that “[new CFPB examinations] will represent current rules and regulations, but will be enforced to a greater extent.”