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Episode 8 – Financial Consumer Rights Talk – Know Your Rights Part II (RESPA). Loss Mitigation and Loan Modification Through the Real Estate Settlement Procedures Act

June 29th, 2015 by

Episode 8 – Know Your Rights Part II. Loss Mitigation and Loan Modification Through the Real Estate Settlement Procedures Act (RESPA)

In episode 8 of the FCRT we discuss regulations governing loan modifications.  The podcast highlights homeowner rights relating to RESPA and loss mitigation procedures including how to appeal a denial of a loan modification application, and rules that prohibit banks from conducting a foreclosure sale while a loss mitigation application is under review.

Real Estate Settlement Procedure Act Regulation X 12 C.F.R. 1024.41 

https://www.law.cornell.edu/cfr/text/12/1024.41

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Foreclosure defense and loss mitigation boot camp

http://www.nbi-sems.com/Details.aspx/R-69347ER%7C?ctname=SPKEM

Episode 7 – Financial Consumer Rights Talk – Student Loan Stress

June 10th, 2015 by

Episode 7 – Financial Consumer Rights Talk – Student Loan Stress

The CFPB whats to hear about how student loans have caused stress.

On March 10, 2015 President Obama released a press statement and a directive for a couple of the federal agencies to take action; the memo is called the “Student Aid Bill of Rights”. This memo asks the Secretary of Education, Secretary of Treasury, and the Director of the CFPB (Consumer Protection Finance Bureau), to issue a report to the president that would assess the potential applicability of consumer protections that have been implemented in the mortgage and credit card markets to the student loan industry.

Google search comparison reflecting interest over time to the topic of student loans compared to mortgage loans.

The president asked for recommendations for statutory or regulatory changes in the area, including where appropriate strong servicing standards could be applicable. That of

Episode 7 – Financial Consumer Rights Talk – Student Loan Stress

The CFPB whats to hear about how student loans have caused stress.

On March 10, 2015 President Obama released a press statement and a directive for a couple of the federal agencies to take action; the memo is called the “Student Aid Bill of Rights”.

This memo asks the Secretary of Education, Secretary of Treasury, and the Director of the CFPB (Consumer Protection Finance Bureau), to issue a report to the president that would assess the potential applicability of consumer protections that have been implemented in the mortgage and credit card markets to the student loan industry.

Senators Urge CFPB to Issue Strong Rules Against Payday Lending

June 9th, 2015 by

In a follow up to an earlier post by Adam Deutsch,  regarding the NJ Investment Policy Committee and the ACE Cash Express connection through JLL Partners,   it now seems that the NJCA may have started a groundswell of support as Federal lawmakers express support of the CFPB issuing strong rules against payday lending as it was reported in a recent press release.

Senators Urge CFPB to Issue Strong Rules Against Payday Lending

Jun 08, 2015

Thirty-two senators submitted a letter to Director Richard Cordray calling for more regulation of the credit products.

As the Consumer Financial Protection Bureau considers new rules to rein in practices in payday and similar types of lending, Sen. Jeff Merkley (D-Ore.) and 31 of his Senate colleagues, including 29 Democrats and two from the Independent Party, recently expressed their support for the initial steps the Bureau has taken and urged the agency to issue the strongest possible rules for the payday lending industry, according to a news release from Merkley

In an Op -Ed published in NJ Spotlight by, Adam Deutsch Esq of Denbeaux and Denbeaux, it was pointed out that “New Jersey maintains a statute that prohibits payday-lending companies from operating within the state. Despite this prohibition, a recent article published by Fortune.com revealed that New Jersey’s public pension fund has invested $50 million in a private equity fund that owns Ace Cash Express Inc., a company that is prohibited from conducting business in New Jersey.

Phyllis Salowe-Kaye,  Executive Director, of NJ Citizen Action (NJCA) went to the New Jersey State Investment Council and speaking jointly with the NAACP, demanded that they remove public money from any private equity firm or hedge fund that invests in predatory payday lending.

“We urged them to pull out of a new $150 million investment with JLL Partners they have all but approved, and also asked them to examine policies to makes sure that pension fund money does not go into businesses that are illegal in New Jersey and to put in place a disclosure requirement regarding any regulatory violation or actions before companies can be considered for investments,” said Phyllis Salowe-Kaye Executive Director, of NJ Citizen Action, who went on to say “ the Investment Policy Committee had already discussed the topic at great length before the May 27th meeting.  At the May 27th meeting the Chairman Byrne called for action and asked the Division of Investment to find out how to divest from JLL Partners.”

A petition is now in circulation asking citizens to demand New Jersey immediately divest from JLL Partners and sign a petition demanding that no NJ Pension Fund dollars are invested in predatory payday lending.

The following links are for a series of articles and press coverage that have been published following the NJCA testimony to the NJ Investment Counsel

AP Story:

State weighs selling stake in firm that owns payday lender.

http://www.cnbc.com/id/102711594

Star Ledger

NJ May Divest From Investment Tied to Predatory Lending

http://www.nj.com/politics/index.ssf/2015/05/nj_may_divest_from_investment_tied_to_predatory_pa.html

Pensions & Investments Online

NJ Council Wants Plan to Deal with Payday Loan Investment

http://m.pionline.com/article/20150601/ONLINE/150609983/nj-council-wants-plan-to-deal-with-payday-loan-investment

Congressional efforts to thwart Consumer Finance Protection Bureau and must be stopped

June 5th, 2015 by

Congressional efforts to thwart CFPB and must be stopped

by Adam Deutsch

As published in the The Hill.

http://thehill.com/blogs/congress-blog/civil-rights/243915-congressional-efforts-to-thwart-cfpb-and-must-be-stopped

Need a sign that the Consumer Financial Protection Bureau (“CFPB”) is quickly becoming the most effective regulatory arm of the Federal Government?  Look no further than the absolute panic being shown by the home loan industry over changes to the disclosures that must be provided to persons entering into mortgage loan agreements.

Under the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA), homeowners are entitled to receive disclosures that provide clarity and transparency to the finance terms of a loan prior to closing.  Roughly 18 months ago the CFPB announced a streamlining of disclosure forms known as the TILA-RESPA Integrated Disclosure (“TRID”), which goes into effect August 1, 2015.  TRID is not a new set of regulations, but rather a consolidation of four existing disclosure rules required under the TILA and RESPA.  In other words, the new rule simplifies the disclosure process for loan originators and brokers, while providing homeowners more clarity in being able to understand the contents of disclosures accompanying loan documents.

Over the past 18 months, the CFPB has gone above and beyond its obligation to provide the industry with education materials to help prepare for the rule change.  The materials include video and written tutorials, compliance guides, uniform templates for disclosures, and timelines explaining when various disclosures must be made.  In April 2014, the CFPB began providing the lending industry with written guide materials.  Despite having substantial notice to prepare for the rule change, the industry has moved into panic mode, defiantly turning to Congress to help give the industry permission to mislead homeowners.

As a result of industry lobbying efforts, on April 27, 2015, a bill was introduced in the House of Representatives (H.R.2213) which seeks to legislate a safe harbor provision following implantation of the August 1, 2015 TRID rules.  The bill is sponsored by Reps. Steve Pearce (R-N.M.) and Brad Sherman (D-Calif.).  If adopted, the TRID regulations “may not be enforced against any person until January 1, 2016 and no suit may be filed against any person for a violation of such requirements occurring before such date, so long as such person has made a good faith effort to comply with such requirements.”  The effect of the bill would be catastrophic.  As drafted, the bill would strip homeowners of their private right of action for actual damages and statutory damages suffered by virtue of a mortgage broker or lender’s failure to provide accurate and timely loan disclosures.

A month later, appearing unlikely that H.R.2213 will be adopted, 255 Members of Congress signed a letter to CFPB Director Richard Cordray requesting that the CFPB itself delay implementation of TRID by adding a grace period allowing the industry to make errors without liability.  The letter states “Even with significant advance notice, understanding how to implement and comply with this regulation will only become clear when the industry gains experience using these new forms and processes in real-life situations.”  Congressional signatories to the letter have drawn a line in the sand declaring that the rights of their constituents are trumped by the rights of the non-voting businesses.

The proposed House of Representatives bill and the May 20 letter to Richard Cordray ask that the lending industry be provided a window of immunity.  This is immunity not only from enforcement by the CFPB, but also from private rights of action from borrowers who are directly harmed by the mortgage loan industry’s conduct.  The Congress members who support the safe harbor have learned nothing from the collapse of the housing market in late 2007.  A safe harbor provision would provide a green light for mortgage brokers and loan originators to return to practices of old, seeking to do as much damage as possible during the immunity period.  Americans should be outraged by the suggestion of providing immunity to lenders from legislation that promotes financial literacy and transparency.  The panic is a sign that the CFPB is producing meaningful and effective legislation pursuant to its authority as created by Congress.  At a minimum, this is a sign that even as Congress ignores its constituents in an effort to follow money, the financial rights of consumers are being guarded by the federal government.

Deutsch, senior associate attorney at Denbeaux & Denbeaux in Westwood, New Jersey, is currently concentrating his practice on consumer rights litigation. 

http://thehill.com/blogs/congress-blog/civil-rights/243915-congressional-efforts-to-thwart-cfpb-and-must-be-stopped