A new year brings new challenges, not to mention the renewal of past concerns still unresolved. Here are a few resolutions your company might consider adopting for 2018:
Don’t procrastinate. By the time you read this, the new Home Mortgage Disclosure Act (HMDA)Rule will be in effect—but if you didn’t already know that, you’re in big trouble. The final rule revises the types of institutions and transactions that are covered by the Act and adds or modifies a bevy of data fields, including: applicant’s age/race/ethnicity/sex; property address; credit score; total loan cost, debt-to-income ratio; and much, much more. Institutions have spent the past two years staffing up and readying their compliance management systems for the change—hopefully, that includes you.
Stay in touch with old friends. And by “friends,” we mean “compliance rules”—specifically TRID. As evidenced by “Sizing Up the New TRID Rule” (see page insert page number once design is done), regulators are still tinkering with amendments to TRID, which means you can’t take it for granted that you know the rule inside and out. Familiarize yourself with “TRID 2.0” (you can start with this very issue of Mortgage Compliance Magazine) and make sure you’re up to speed by the mandatory implementation date: October 1, 2018.
Don’t be an April Fool. Most of the provisions of the Consumer Financial Protection Bureau’s Amended Servicing Rule went into effect in October, but there were two parts of it that were delayed: those provisions relating to required periodic statements for borrowers in bankruptcy, and those provisions relating to successors in interest. Don’t get caught stumbling over the details.
Don’t procrastinate! It bears repeating. The period for annual MLO license renewal is November 1-December 31 each year. It may seem a long way off, but think of how quickly the time will seem to pass. As our own Om-Bobs-Man would say, “Your license is YOUR business.” Find the resources you need at https://nationwidelicensingsystem.org/slr/common/renewals/Pages/default.aspx.
Statistics suggest that the vast majority of new year’s resolutions fail by mid-February. You might not have the time to hit the gym every day or learn a new language, but if you can stick to these suggestions, you’ll at least be on top of your compliance game.
What resolutions should the mortgage industry set for itself in 2018?
“Lenders should resolve not to wait until the last minute to scrub year-end HMDA data for ‘errors.’ They should take it upon themselves now to implement systems and processes that ensure consistency and objectivity in underwriting decisions and pricing at the point of sale.” Ben Wu, Executive Director of LoanScorecard
“Lenders should identify areas where technology can reduce or improve efficiency in their compliance workflow, and aim to implement at least one new RegTech solution before the end of 2018.” Michael Cremata, Senior Counsel and Director of Compliance at ClosingCorp
“In 2018, our industry should look to understand the transformative power of RegTech, which combines machine learning and artificial intelligence with predictive analytics to monitor risk and drive regulatory compliance.” John Vong, President of ComplianceEase
“In 2018, the industry should prepare for continuing (if not increased) regulation by states, and should not become lax because of the initiative to de-regulate at the federal level. Particularly in highly interventionist states, we have seen no reduction in consumer protection activity by the state AGs and regulatory agencies; in fact, in many states, activity has increased in response to the uncertainty at the federal level. Compliance will become harder, not easier, as industry participants will need to follow legislation and regulation that varies from state to state.” Maria Moskver, General Counsel and Enterprise Compliance Officer at LenderLive
“Resolve to attend the Nationwide Mortgage Licensing System (NMLS) and American Association of Residential Mortgage Regulators (AARMR) conferences this year—and join the Mortgage Compliance Professionals Association of America.” Bob Niemi, Senior Advisor at BakerHostetler and former NMLS Ombudsman