Flood Notice To Borrower 10 Days Before Closing

Adam Witmer
Flood

While flood insurance compliance is extremely important due to potential fines and penalties, the rules can be quite confusing and cumbersome for both customers and financial institutions.  For example, when a structure is found to be in a high-risk flood zone, flood rules require that a flood notice be sent to the applicant advising them of being in a flood zone, their responsibilities for obtaining insurance, and a few other disclosures.  These rules, however, don’t provide time-frames on when, exactly, the flood notice must be delivered. Therefore, there has been quite a bit of confusion over the timing requirements of the flood notice that must be delivered to borrowers who have a collateralized structure in a high-risk flood zone.

Special Exception Hold Reasonable Cause Examples

Adam Witmer
Regulation CC

In auditing check holds over the years, I have often found violations of of Regulation CC.  These violations result from a number of things, such as incorrectly calculating the amount of a hold or incorrectly choosing the wrong date to make funds available.  Often times, there isn’t a pattern or practices as to why these violations occur - other than a lack of training - though I have noticed a trend of violations relating to one specific special exception hold reason: The reasonable cause to doubt collectibility.

Contents of a CRA Public File

Contents of a CRA Public File

Adam Witmer
CRA

In this Compliance Clip (video), Adam reviews the items needed to be in the CRA public file of each bank. As the CRA public file must be current as of April 1 of each year, banks can use this video to review their public file and ensure they have everything they need.

As explained in this video, certain information must be kept in each bank’s CRA public file. The following is section 228.43 from Regulation BB, which…

OCC Releases List of Key HMDA Data Points

Adam Witmer
Regulatory Update, HMDA

On March 7, 2019, the Office of the Comptroller of the Currency (OCC) released a bulletin (2019-12) explaining the key HMDA data fields for full and partial HMDA reporters.  In their bulletin, the OCC explains that key data fields have been identified to support the efficient and effective evaluation of banks’ compliance with HMDA requirements. Of the 110 total data fields, 37 have been identified as key fields by the OCC, Federal Reserve Board (FRB), and Federal Deposit Insurance Corporation (FDIC) on an interagency basis. The OCC explains that OCC examiners will typically test and validate these 37 key fields for the banks that are required to collect, record, and report information for all HMDA data fields. For banks that qualify for a partial exemption from the HMDA data collection, recording, and reporting requirements, OCC examiners will typically test and validate 21 of those 37 fields.

CFPB Provides Snapshot of Mortgage Complaints

Adam Witmer
Regulatory Update, Compliance Management

At the end of January (1/29/29), the CFPB released their “Complaint snapshot: Mortgage” document.  This report takes a deep dive into the mortgage-related complaints received by the Bureau and also highlights some trends that they have observed. For those of you with large mortgage originations and portfolios (which is almost every financial institution), this information can be extremely valuable for two reasons.  First, this information can…

CFPB Reaches More Settlements

Adam Witmer
Regulatory Update

In addition to the settlement with USAA on January 3, 2019, the CFPB has made settlements with five other entities already in 2019.  Headquartered in Akron, Ohio, Sterling Jewelers operates over 1.500 jewelry stores under several names, including Kay Jewelers, Jared The Galleria of Jewelry, JB Robinson Jewelers, Marks & Morgan Jewelers, Belden Jewelers, Goodman Jewelers, LeRoy’s Jewelers, Osterman Jewelers, Rogers Jewelers, Shaw’s Jewelers, and Weisfield Jewelers.

CFPB Issues Analysis on Elder Financial Exploitation

Adam Witmer
BSA, Regulatory Update

On February 27, 2019, the CFPB issued a report titled “Suspicious Activity Reports on Elder Financial Exploitation: Issues and Trends.”  In their release, they explain that financial institutions have reported over 180,000 suspicious activities targeting older adults. Combined, these Suspicious Activity Reports (SARs) involved more than $6 billion in elder financial exploitation.

The first of its kind, this report presents a public analysis of SARs filed for elder financial exploitation between 2013 and 2017.  The CFPB explains that the findings in the analysis provide an “opportunity to better understand the complex problem of elder financial exploitation and to identify ways to improve prevention and response.” The full report runs 35 pages long and includes several sections including…

5 Tips for Leading an Annual Day of Compliance Training

5 Tips for Leading an Annual Day of Compliance Training

Adam Witmer
Compliance Management

In this Compliance Clip (video), Adam provides 5 tips for leading an annual day of compliance training. As many banks continue to have an annual day of training that includes at least some compliance training, it is important for compliance professionals to be able to effectively deliver the content of the training. The reality of this is that the deliver can be a challenge because staff often resist the training and push back a bit or even complain that it doesn’t apply to them. Therefore, it is essential that compliance training be delivered in the best way possible. Adam uses this video to provide 5 tips (and a bonus) that he uses when leading compliance training for all employees of a financial institution.

Also, if you are interested in having Adam speak at one of your future compliance training days, you can contact us at members@compliancecohort.com.

Revised Loan Estimates After Rate Lock

Adam Witmer
Regulation Z, TRID

For years now, I have been advocating that there is only one reason why a revised Loan Estimate must absolutely be issued: when an initially floating rate is subsequently locked.

Sure, there are other reasons a financial institution can issue a revised loan estimate, such as when there is a valid changed circumstance, but the only time a revised Loan Estimate is absolutely required is when an initially floating rate is subsequently locked.

While this reason for a revised loan estimate may seem simple, there are actually some questions that arise with the requirement to provide a revised Loan Estimate from a rate lock.  For example, you may be asking one of the following questions:

  • Is a written rate lock agreement required for the revised Loan Estimate trigger?

  • Is a revised Loan Estimate required after a rate expiration or for a rate extension?

  • Is a revised Loan Estimate required when a rate is locked after a Closing Disclosure has been issued?

  • Is a revised Closing Disclosure required when a rate is locked after a Closing Disclosure has been issued?

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