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The Federal Housing Finance Agency has announced that Fannie Mae and Freddie Mac (the Enterprises) are making historical VantageScore 4.0 credit scores available to approved users to support the transition to updated credit score and credit report requirements.

The historical credit scores for each Enterprise are associated with single-family loans purchased by that Enterprise from April 2013 through March 2023. This comprehensive release reflects the period for which trended consumer credit data is reliably available across the three nationwide consumer reporting agencies. These scores will provide market participants the ability to better analyze and understand the new credit score models that have been validated and approved for use by the Enterprises. The historical credit scores are available for download at the Enterprises’ respective websites.

In October 2022, FHFA announced the validation and approval of modernized credit score models for use by the Enterprises. At the same time, FHFA announced that the Enterprises would permit lenders to deliver loans with either tri-merge credit reporting, in which credit reports from each of the three nationwide consumer reporting agencies are used, or bi-merge credit reporting, in which credit reports from two of the nationwide consumer reporting agencies are used.

• Fannie Mae Credit Score Models and Reports Initiative
• Freddie Mac Credit Score Models and Reports Initiative

The FDIC has updated section 3.2 (Loans) of its Risk Manual of Examination Policies. The discussion related to the issuance of “Express Determination” letters has been updated to reflect current accounting guidance regarding the allowance for credit losses on loans and leases and procedures related to examinations conducted under the FDIC’s continuous examination program. Additional updates include the concurrent deletion of the “Troubled Commercial Real Estate Loan Classification Guidelines” and update to the “Commercial Real Estate Loans” sections.

The CFPB yesterday announced proposed new rules to make it easier for homeowners to get help when they are struggling to pay their mortgage. The proposed amendments to Regulation X, if finalized, would require mortgage servicers to focus on helping borrowers, not foreclosing, when a homeowner asks for help. The proposed changes would also make it simpler for servicers to offer assistance by reducing paperwork requirements, improve communication with borrowers, and ensure critical information is provided in languages borrowers understand. The CFPB is requesting comment about several other topics, including possible approaches it could take to ensure servicers are furnishing accurate and consistent credit reporting information for borrowers undergoing review for assistance.

• Proposed rule
• Unofficial redline of the proposed Regulation X amendments
• Fast Facts about the proposal

The current regulations governing mortgage servicing took effect in 2014. The rules have rigid timing and other requirements that servicers must follow in all cases. The rules also rely on borrowers submitting all their documents before the servicer begins its review or pauses foreclosure proceedings. In 2022, the CFPB asked the public for input on improving protections for borrowers facing financial hardships. The CFPB heard from both the mortgage industry and borrower advocates that a simpler, more flexible approach to mortgage assistance would be helpful.

Yesterday's proposal, if finalized, would—

• Stop dual tracking and limit fees: The proposed rule would require servicers to try to help borrowers first, before foreclosing, when they request assistance. Servicers would generally only be allowed to move ahead with foreclosure after all possibilities for assistance are exhausted or the borrower has stopped communicating with the servicer. The proposal would also limit the fees a servicer can charge a borrower while the servicer is reviewing possible options to help the borrower.
• Reduce delays by streamlining paperwork requirements: Currently, a servicer cannot evaluate whether a borrower is eligible for assistance without a “complete application” that includes all information needed to assess eligibility for all available options. This can delay assistance offers, hurting both homeowners and servicers. Under the proposal, servicers would have more flexibility to review borrowers for each option individually, potentially enabling quicker assistance.
• Improve borrower-servicer communications: The proposed rule would require servicers to provide more tailored notices to borrowers, so they know what actions they can take if they want to. This includes changing the notices that borrowers get shortly after missing a payment to include information about who the loan investor is and how to get information about available assistance.
• Ensure borrowers receive critical information in languages they understand: Under the proposal, borrowers who received marketing materials in another language could request mortgage assistance communications in that same language. The proposed rule would also require servicers to provide the improved notices in both English and Spanish to all borrowers, as well as make available oral interpretation services in telephone calls with borrowers.

The new provisions would not apply to small servicers. All existing requirements remain in effect until the effective date of a final rule. Comments must be received by September 9, 2024. PUBLICATION UPDATE: Published at 89 FR 60204 in the July 24, 2024, Federal Register.

A notice was posted to the Department of Defense's MLA site that, due to scheduled maintenance, the MLA website will not be available on Saturday, June 13, 2024, from 6:00 PM PDT until 10:00 PM PDT (9:00 PM EDT on Saturday until 1:00 AM EDT on Sunday). The notice clearly should refer to July 13, which falls on Saturday, not June 13.

The CFPB yesterday announced it has taken action against repeat offender Fifth Third Bank for a range of illegal activities that would result in the bank paying $20 million in penalties in addition to paying redress to approximately 35,000 harmed consumers, including about 1,000 who had their cars repossessed. Specifically, the CFPB is ordering Fifth Third Bank to pay a $5 million penalty for forcing vehicle insurance onto borrowers who had coverage. The CFPB also filed a proposed court order that would require Fifth Third Bank to pay a $15 million penalty for opening fake accounts in the names of its customers. The proposed court order bans Fifth Third Bank from setting employee sales goals that incentivize fraudulently opening accounts.

For further information on yesterday's CFPB actions against Fifth Third, see BankersOnline's Penalty page.

In 2015, the CFPB took two actions against the bank – one for discriminatory auto loan pricing, which was a joint CFPB and U.S. Department of Justice action, and the other for illegal credit card practices. For the discriminatory auto loan pricing action, Fifth Third Bank was ordered to pay $18 million to harmed Black and Hispanic borrowers. For the illegal credit card practices, the bank was ordered to pay $3 million to harmed consumers and a $500,000 penalty.

The Federal Reserve Board's archive of evaluations of member banks' Community Reinvestment Act compliance includes 15 evaluations made public by the Reserve Banks in June 2024, all of which carried Satisfactory ratings.

On Monday, the Treasury Department, as Chair of the Committee on Foreign Investment in the United States (CFIUS), issued a Notice of Proposed Rulemaking that would expand CFIUS’s jurisdiction over certain transactions by foreign persons involving real estate in the United States. Under legislation that Congress passed in 2018, CFIUS has the authority to review certain real estate transactions near specified military installations and to take action in appropriate circumstances. This proposed rule would add over 50 military installations, across 30 states, to the existing list of installations around which CFIUS has jurisdiction, including over land purchases.

The proposed rule would enhance CFIUS’s authorities through the following key changes:

• Expand CFIUS’s jurisdiction over real estate transactions to include those within a one-mile radius around 40 additional military installations;
• Expand CFIUS’s jurisdiction over real estate transactions to include those within a 100-mile radius around 19 additional military installations;
• Expand CFIUS’s jurisdiction over real estate transactions between 1 mile and 100 miles around eight military installations already listed in the regulations;
• Update the names of 14 military installations already listed in the regulations to better assist the public in identifying the relevant sites; and
• Update the location of seven military installations already listed in the current regulations to better assist the public in identifying the relevant sites.

Comments on the proposal will be accepted for 30 days following the NPRM’s publication in the Federal Register.

The FDIC has issued a list of 64 banks examined for compliance with the Community Reinvestment Act who were assigned evaluation ratings in April 2024. Four of those banks — The Peoples Bank, Gambier, Ohio; Union Bank, Lake Odessa, Michigan; Bank of Crocker, Waynesville, Missouri; and Forbright Bank, Potomac, Maryland — were rated "Needs to Improve." Fifty-eight banks received "Satisfactory" ratings.

We congratulate two banks — Bank of Charles Town, Charles Town, West Virginia, and UBS Bank USA, Salt Lake City, Utah — who received ratings of "Outstanding."

The CFPB yesterday announced publication of an edition of its Supervisory Highlights sharing key findings from recent examinations of auto and student loan servicing companies, debt collectors, and other financial services providers. The report also highlights consumer complaints about medical payment products and identifies concerns with providers preventing access to deposit and prepaid account funds.

The Federal Housing Finance Agency yesterday announced the publication of updated aggregate statistics from the National Mortgage Database (NMDB) and launched the NMDB Aggregate Statistics Dashboard—a new data visualization tool for the NMDB Outstanding Residential Mortgage Statistics.

Yesterday’s release describes outstanding residential mortgage debt at the end of the first quarter of 2024. Highlights include:

• There were 50.8 million outstanding mortgages with unpaid balances totaling $11.7 trillion at the end of the first quarter of 2024.
• 21.9 percent of outstanding mortgages have interest rates below 3 percent, down slightly from a high of 24.6 percent in the first quarter of 2022. 14.3 percent of outstanding mortgages have interest rates of 6 percent or higher.
• Adjustable-rate mortgages (ARMs) account for 3.5 percent of outstanding mortgages, down from 9.6 percent one decade ago.
• The median monthly payment among outstanding mortgages is $1,520.
• The average credit score among borrowers with an active loan is 743.