Top Story Lending Related

The Federal Housing Finance Agency (FHFA), as conservator of Fannie Mae and Freddie Mac, announced yesterday that it has reached a settlement with Royal Bank of Scotland Group plc, related companies and specifically named individuals (collectively RBS) for $5.5 billion. The settlement resolves all claims in the lawsuit filed by the FHFA alleging violations of federal and state securities laws in connection with private-label residential mortgage-backed securities trusts purchased by Fannie Mae and Freddie Mac between 2005 and 2007. Under the terms of the agreement, Royal Bank of Scotland will pay approximately $4.525 billion to Freddie Mac and approximately $975 million to Fannie Mae and certain claims against Royal Bank of Scotland related to the securities involved will be released.

HUD and the National Environmental Health Association (NEHA) have announced that four model programs around the nation are recipients of the HUD Secretary’s Award for Healthy Homes, an award recognizing excellence in making indoor environments healthier. For the third consecutive year, HUD and NEHA identified outstanding local programs that promote healthier housing through research, education or innovated practices.

The FFEIC has posted updated resources for financial institutions collecting HMDA data during or after 2017.

The minutes of the Federal Reserve Board’s June 5 and June 14, 2017, discount rate meetings have been released. The minutes of the June 14 meeting state the board’s consensus for a 25-basis-point increase, and the Board approved an increase in the primary credit rate from 1½ percent to 1¾ percent, effective June 15, 2017, for the nine Reserve Banks that had voted for such an increase.

HUD has announced that the Department's Mortgagee Review Board (MRB) is immediately suspending mortgage lender Seckel Capital, LLC, Newtown, Pennsylvania, from originating and underwriting new mortgages insured by the Federal Housing Administration (FHA). In addition, HUD's Departmental Enforcement Center suspended owner John Seckel from doing business with the Federal government. An investigation by HUD into the financial practices of Seckel and his company found that Seckel knowingly and fraudulently submitted false financial statements to the government certifying there were audited by an independent accounting firm when, in fact, they were not. HUD found that Seckel Capital and John Seckel engaged in a years-long pattern of submitting false financial statement to the FHA, representing them as properly audited by independent certified public accountants.

The CFPB has published [82 FR 32177] a notice formally extending the July 14, 2017, comment deadline for its Request for Information Regarding the Small Business Lending Market [82 FR 22318] to September 14, 2017.

The Consumer Financial Protection Bureau has issued a new rule to ban companies from using mandatory arbitration clauses to deny groups of people their day in court. Many consumer financial products like credit cards and bank accounts have arbitration clauses in their contracts that prevent consumers from joining together to sue their bank or financial company for wrongdoing. By forcing consumers to give up or go it alone – usually over small amounts – companies can make it financially impractical for the average consumer to sue, thus avoiding both the costs and potential court orders to cease the practices in question. The CFPB’s new rule is meant to deter wrongdoing by restoring consumers’ right to join together to seek damages and corrected conduct through group lawsuits. Under the rule, companies can still include arbitration clauses in their contract,.but companies subject to the rule may not use arbitration clauses to stop consumers from being part of a group action. The rule includes specific language that companies will need to use if they include an arbitration clause in a new contract.

The new CFPB rule applies to the major markets for consumer financial products and services overseen by the Bureau, including those that lend money, store money, and move or exchange money. The rule will be effective 60 days after publication in the Federal Register, and applicable to contracts entered into more than 180 days after the effective date.

UPDATE: Published on July 19, 2017, at https://www.federalregister.gov/d/2017-14225, with effective date of September 18, 2017, and mandatory compliance for contracts entered into on or after March 19, 2018.

• CFPB press release
• Arbitration Agreements Rule
• CFPB YouTube video about the rule
• CFPB Director Richard Cordray's prepared remarks for press call.
• CFPB's Arbitration Agreements Rule implementation page.

The Federal Reserve Board has posted its G.19 Consumer Credit data for the month of May 2017. During that month, consumer credit increased at a seasonally adjusted annual rate of 5¾ percent. Revolving credit increased at an annual rate of 8¾ percent, while nonrevolving credit increased at an annual rate of 4¾ percent.

The Department of Defense has posted a notice on its MLA site reporting that the site will be unavailable from 6 p.m. July 15 to 12 a.m. on July 16; and from 6 p.m. July 22 to 12 a.m. on July 23 due to planned system maintenance.

The following products have been released by the FFIEC:

• The FFIEC Online Census Data System (formerly FFIEC Census Reports) provides census data for Metropolitan and Non-Metropolitan areas, counties, and census tracts.

• The FFIEC Census Information Sheets are summaries of how the census data have changed from previous years and guidance on how to combine the census data with the appropriate year(s) of HMDA and CRA data.

• The FFIEC Census Windows Application is a downloadable Windows-based tool that allows you to search and export data, and to create reports using the census data that are published in the HMDA and CRA aggregate and disclosure reports.

• The FFIEC Estimated Median Family Income Report is a list of FFIEC Estimated Median Family Incomes for each MSA and for the non-metropolitan areas of each state.

In addition to the data available from the links above, certain census data are included in the HMDA LAR & TS Raw Data Application. Included with the raw data are Population, Minority Population Percent, MSA Median Family Income, Census Tract MFI to MSA MFI Percent, Number of Owner Occupied Housing Units, and Number of One to Four Family Units. Also, the 2017 Geocoding System has been updated with the 2017 Census demographic data based on the 2011–2015 five year estimated American Community Survey (ACS).