At a glanceFriday, April 09, 2021

Collection Industry News At A Glance - April 9, 2021
Friday April 9, 2021
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Can the CFPB’s new forbearance rules prevent a foreclosure crisis?

While forbearance numbers have declined somewhat in recent weeks, around three million homeowners are still behind on their mortgages. As foreclosure moratoriums are set to expire later this year, the housing market is now facing the risk of a shock from millions of homeowners going from forbearance straight into foreclosure.

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CFPB Signals Continued Progress Toward Dodd-Frank 1071 Notice of Proposed Rulemaking

On the heels of CFPB Acting Director Dave Uejio’s recently released statement to agency staff members, the Bureau again signaled that it is making progress toward issuing a Notice of Proposed Rulemaking (NPRM) enacting Section 1071 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act). Specifically, in late February, the CFPB filed its fourth status report in the United States District Court for the Northern District of California as part of a legal settlement. This latest status report indicates that the Bureau is moving closer towards issuing to enact these important regulations.

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JPMorgan Chase CEO Jamie Dimon: Fintech is an ‘enormous competitive’ threat to banks

Jamie Dimon, JPMorgan Chase chairman and CEO, listed fintech as one of the “enormous competitive threats” to banks in his annual shareholder letter released Wednesday. “Banks ... are facing extensive competition from Silicon Valley, both in the form of fintechs and Big Tech companies,” like Amazon, Apple, Facebook, Google and Walmart, Dimon wrote, and “that is here to stay.”

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Developing a lending strategy for rising mortgage rates

As we enter the second quarter of 2021, it’s time for the mortgage industry to reflect on the past 12 months and think about how to plan for the same period ahead. After all, it was mid-March of last year that the president declared a national emergency leading to school closures, the wearing of masks, and the emptying of office buildings across the country. A little over a year ago, we could have never imagined the actual implications of COVID’s impact to come on this nation, our communities, families and our business.

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Does CFPB have authority to postpone foreclosures?

The Consumer Financial Protection Bureau released a proposed rule on Monday that would bar servicers from starting on foreclosures until 2022. The CFPB also proposed streamlined processes for moving homeowners out of forbearance and into loss mitigation options. However, since the announcement, several industry leaders have expressed reservations about the blanket policy.

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Most big debt collectors backed off during the pandemic. One pressed ahead.

When Covid-19 hit the economy, most debt collectors gave borrowers a break, cutting back on lawsuits amid lockdowns, closed courts and loan-forbearance initiatives. One of the biggest and least-known companies in the industry did the opposite.

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Jobless claims: Another 744,000 Americans filed new claims last week

New weekly jobless claims unexpectedly held above 700,000 last week to extend a rise from late March, despite other signs that rehiring has been taking place across the recovering economy. 

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Maryland Medical Debt Collection Requirements Bill Awaits Governor’s Signature

Maryland could become the latest state to have a medical debt collection bill on the books after SB 514 and HB 565 were approved 47-0 and 134-0 in the state’s Senate and House, respectively.

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CFPB develops a proposal to avoid widespread foreclosures

The Consumer Financial Protection Bureau (CFPB) has developed a proposal to prevent avoidable foreclosures as temporary forbearance measures put in place during the pandemic will expire in the fall. The CFPB’s proposal seeks to ensure that both mortgage servicers and borrowers can work together to prevent avoidable foreclosures.

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How quickly can you get a mortgage refinance after buying a home?

Even if you’ve just purchased a home, watching mortgage rates drop makes it tempting to refinance your existing loan. After all, even a minor decrease can have a big impact when it comes to savings. Cindy Couyoumjian, founder of Cinergy Financial and author of "Redefining Financial Literacy," used the following example to illustrate that point. "Suppose your mortgage payment is $1,000, if you lower your interest rate by 1%, your payment will be reduced by $100," she explained. "That’s a $12,000 savings over 10 years. You need to look at the big picture when refinancing a home. A 1% drop in interest rate can translate to thousands of dollars saved over the life of the loan."

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Biden consumer watchdog seeks delay of Trump-era debt collection rules

The Consumer Financial Protection Bureau proposed a delay Wednesday to two debt-collection rules issued in the waning days of the Trump administration. Those rules broadly addressed how debt collectors may communicate with and make disclosures to consumers.

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CFPB Proposes Delay of Effective Date for Recent Debt Collection Rules

WASHINGTON, D.C. – The Consumer Financial Protection Bureau today proposed extending the effective date of two recent debt collection rules to give affected parties more time to comply due to the ongoing COVID-19 pandemic. The debt collection rules, issued in late 2020, are scheduled to take effect on November 30, 2021.  The CFPB is proposing to extend the effective date of both rules to January 29, 2022.

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Americans keep stretching auto loans to make car payments affordable

At the end of 2020, the average price for a new car ticked past $40,000 for the first time. In the first quarter of this year, the average price fell, but still hung around $38,000. To meet rising car prices, Americans continue to extend auto loan terms even further, and new data from TrueCar released at the end of March shows the trend in full swing.

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New USDA loan limits for 2021: How much can you borrow?

For a long time, the USDA loan program was unique in that it didn’t enforce loan limits. That meant home buyers could theoretically borrow any amount — so long as they met other USDA mortgage requirements. But that changed this year. USDA now caps the amount you can borrow to buy or refinance. Loan sizes max out at $285,000 in much of the U.S., with expanded limits in higher-cost real estate markets.

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Acceleration in Student Loan Debt Could Block Millions From Homeownership

In-state tuition and fees at public universities increased from $6,189 in 2007 to $11,260 in 2020, according to U.S. News & World Report, an increase of 81.9% — and many students are increasingly reliant on student loans to help shoulder the rising costs. In 2007, student debt amounted to just 4.4% of total household debt. By 2020, that had more than doubled to 10.7%, a 143% increase over the span of 13 years that far outpaces in-state tuition hikes. 

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Consumer protection agency cracks down on mortgage servicers that don’t assist struggling homeowners

The Consumer Financial Protection Bureau is warning mortgage servicers that they’re expected to help the surge of struggling homeowners in the pandemic and explore options other than foreclosure. “Responsible servicers should be preparing now,” CFPB Acting Director Dave Uejio said in a statement. “There is no time to waste, and no excuse for inaction.”

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Bill to reinstate foreclosure moratorium moves on to Oregon Senate after gaining approval in House

Oregon lawmakers edged closer toward reinstating the statewide moratorium on residential foreclosures Tuesday as House Democrats pushed through a bill that would protect homeowners until at least June 30.

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AG Slatery Urges U.S. Department of Education to Forgive Loans for Some ITT Tech Students

Nashville- Attorney General Herbert H. Slatery III urged the U.S. Department of Education to cancel federal student loan debt for some students who attended ITT Technical Institute. The now defunct for-profit school defrauded thousands of individuals by encouraging them to enroll and borrow loans based on false and misleading information about the value of an ITT degree.

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FTC Annual Highlights 2020

The Federal Trade Commission is a bipartisan federal agency with a unique and important mission: protect consumers and promote competition. In 2020, the FTC continued to promote competition by challenging harmful mergers and anticompetitive business conduct that harms consumers. As part of its active merger enforcement agenda, the Commission sued to block or unwind an unprecedented nine mergers and negotiated settlements to prevent harm in another 12 transactions. Ten other deals were abandoned in the face of antitrust concerns raised in FTC investigations.

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Michigan lawyers charged in alleged fraudulent debt-collecting scheme

Three lawyers in Michigan have been charged in connection with an alleged scheme to collect debts that may not have been owed, according to reports. The Oakland County attorneys -- identified as Marc Fishman, 70; Ryan Fishman, 32; and Alexandra Ichim, 33 -- were charged with multiple felony counts that included racketeering, forgery and obstruction of justice, according to FOX 2 in Detroit.

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Mortgage Firms Face Foreclosure Ban Until 2022 Under CFPB Plan

(Bloomberg) -- Millions of homeowners who’ve fallen behind on mortgage payments due to the pandemic would have more time before facing foreclosure under rules proposed Monday by the Consumer Financial Protection Bureau.

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CFPB Takes Action Against Debt Collector And Its Owner For Falsely Threatening Consumers with Legal Action

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) today issued a consent order against a debt collector and its owner for harassing thousands of consumers, falsely threatening them with legal action. The CFPB found that Yorba Capital Management, LLC (Yorba) and its former owner, Daniel Portilla, Jr., violated the Consumer Financial Protection Act of 2010 (CFPA) and that Yorba violated the Fair Debt Collection Practices Act (FDCPA). 

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19 states have higher student-loan debt than annual budgets, report finds

The student-debt problem numbers are massive: 45 million people owe $1.7 trillion. But another big number is 19, as that many states have more outstanding student debt than their annual budgets.

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CFPB warns servicers: “Unprepared is unacceptable”

In a Thursday compliance bulletin, the CFPB said it will monitor how servicers work to prevent a wave of foreclosures from occurring this fall. “Unprepared is unacceptable,” the Bureau said. The CFPB will closely monitor how servicers engage with borrowers, respond to borrower requests and process applications for loss mitigation.

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CFPB proposes foreclosure ban until 2022

The Consumer Financial Protection Bureau (CFPB) released a notice of proposed rulemaking on Monday that would amend Regulation X to provide a special pre-foreclosure review period prohibiting servicers from starting foreclosures until after December 31, 2021. Under current CFPB foreclosure rules, a borrower must be 120 days delinquent before the foreclosure process can start. The Bureau said that nearly 2.1 million households in forbearance are past the 90-day delinquent mark and said it is concerned that those homeowners may be transferred immediately in to the foreclosure process once their forbearance period expires.

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CFPB Proposes Mortgage Servicing Changes to Prevent Wave of COVID-19 Foreclosure

WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) today proposed a set of rule changes intended to help prevent avoidable foreclosures as the emergency federal foreclosure protections expire. Due to the COVID-19 pandemic and ensuing economic crisis, millions of families nationwide have suffered the loss of income and nearly 3 million homeowners are behind on their mortgages. The CFPB’s proposal seeks to ensure that both servicers and borrowers have the tools and time they need to work together to prevent avoidable foreclosures, recognizing that the expected surge of borrowers exiting forbearance in the fall will put mortgage servicers under strain.

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A complete guide to COVID-19 financial relief

In March, Americans started receiving the third and latest round of federal COVID-19 financial relief through the Economic Impact Payments (EIP) distributed through the American Rescue Plan. Yet, millions of eligible individuals still haven’t received the first and second payments – and likely won’t receive the third – unless they file a 2020 tax return or tax extension by May 17, 2021.

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CFPB warns lenders of “tidal wave” of distressed mortgages

As the economy recovers, businesses reopen and people return to work, pandemic economic relief programs will be winding down, including mortgage forbearance programs. As of January, more than 2.7 million people were still in the programs to put payments on hold during the pandemic, according to the Consumer Financial Protection Bureau.  The CFPB is warning mortgage servicers to get ready for what it calls a “tidal wave of distressed homeowners” when forbearance starts to expire in June.

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Considering a mortgage refinance loan? This is how much a 1% rate drop can save you

The current juggling of interest rates by the Federal Reserve is an effort to jump-start a sluggish economy and lower unemployment numbers due to COVID-19. Mortgage rates still remain low, although they have inched up slightly as the economy begins to show signs of gaining strength.

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Today’s mortgage refinance — one key rate rate slips back under 3% | April 5, 2021

Based on data compiled by Credible Operations, Inc., NMLS Number 1681276, current mortgage refinance rates have fallen compared to last Thursday’s, with 20-year rates dropping below 3% for the first time in seven days. Average rates across all loan types remain low at 2.719%.

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Industry Events

RMAI 2021 Annual Conference – In Person and Virtual

Receivables Management Association International (RMAi)

Las Vegas, Nevada
April 12 - 15 , 2021

Collection and Recovery Solutions 2021 (CRS2021)

Resource Management Services, Inc.

Produced by: Resource Management Services, Inc. 10440 Pioneer Blvd., Suite 2 Santa Fe Springs, CA. 90670-8235
Las Vegas , Nevada - Originally Scheduled for:
May 12 - 14 , 2021

562-906-1101 - This event has been tentatively postponed - to be held either later this year, or next year.