Good question and it’s probably just as messed up as it always has been but it all depends on….the type of loan; type of financial institution (e.g., bank; savings and loan; independent mortgage lender/broker, etc,.), what goes wrong, and the responsible alphabet soup agency in Washington, DC…
The type of loan:
Government (FHA/VA/Farm/Other) or Conventional (Fannie Mae/Freddie Mac/Other)
The type of problem:
Lender behavior – scam (bait & switch) – fraud – etc,.
If you ever have a problem with your lender, who do you call when you can’t get anywhere with them?
- The Office of the Comptroller of the Currency (OCC) oversee and examines banks-savings and loans.
The Office of the Comptroller of the Currency (OCC) issued the “Residential Real Estate Lending” booklet of the Comptroller’s Handbook. This revised booklet replaces the “Real Estate Loans” booklet issued in March 1990 (and examination procedures issued in March 1998). The revised booklet also replaces section 212, “One- to Four-Family Residential Real Estate Lending,” issued in February 2011 as part of the former Office of Thrift Supervision (OTS) Examination Handbook for the examination of federal savings associations (FSA).
The revised booklet incorporates and reflects applicable national bank and federal savings association statutes and regulations, guidance, and examination procedures. The booklet also provides updated guidance to examiners on assessing and managing the risks associated with residential real estate (RRE) lending activities.
This Comptroller’s Handbook booklet is intended to be a summary restatement of existing laws, regulations, and policies. Examiners and members of the public may use this booklet as reference for an overview of this subject. Nothing in this booklet should be interpreted as changing existing OCC policy.
- The Consumer Finance Protection Bureau (CFPB) oversees and examines complaints about lenders.
The CFPB governs Independent Mortgage Brokers/Lenders..To file a complaint against any lender’s behavior, Click this CFPB complaint link
Mortgage brokers are governed by a host of federal laws and regulations. For example, mortgage brokers must comply with: the Real Estate Settlement Procedures Act (RESPA), the Truth in Lending Act (TILA), the Home Ownership and Equity Protection Act (HOEPA), the Fair Credit Reporting Act (FCRA), the Equal Credit Opportunity Act (ECOA), the Gramm-Leach-Bliley Act (GLBA), and the Federal Trade Commission Act (FTC Act), as well as fair lending and fair housing laws.
Additionally, mortgage brokers are under the oversight of the Department of Housing and Urban Development (HUD) and the Federal Trade Commission (FTC); and to the extent their promulgated laws apply to mortgage brokers, the Federal Reserve Board, the Internal Revenue Service, and the Department of Labor.
Mortgage brokers, like bankers and other lenders, comply with every federal law and regulation affecting the mortgage loan origination industry. Additionally, mortgage brokers comply with a host of state laws and regulations affecting their businesses, from which bankers and lenders are largely exempt.
The regulation of mortgage brokers begins at the federal level, but it certainly does not end there. Mortgage brokers are licensed or registered and must comply with pre-licensure and continuing education requirements and criminal background checks in forty-nine states and the District of Columbia. Additionally, over half of these states require not only mortgage broker licensure, but the licensure or registration of brokers’ individual loan officers as well. An increasing number of states are requiring these originators to pass tests in order to become licensed. The same is not true for the thousands of loan officers employed by mortgage bankers and other lenders, who are exempt in most states from loan officer licensing statutes.
Office of the Comptroller of the Currency exempts depository institutions from state licensing requirements, the states continue to increase their regulation of mortgage brokers and their individual loan officers. Many states also exempt lenders from licensing if they are approved by Fannie Mae or HUD, which subjects those lenders and their employees to significantly less regulation than most mortgage brokers.
Mortgage brokers must also comply with numerous predatory lending and consumer protection laws, regulations and ordinances (i.e., UDAP laws). Again, this is not true for a great number of depository banks, mortgage bankers, mortgage lenders and their employed loan officers, which remain exempt due to federal agency preemption. Many states also subject mortgage brokers to oversight, audit and/or investigation by mortgage regulators, the state’s
attorney general, or another state agency, and in some instances all three.
The following is only a partial list of those federal regulatory agencies currently overseeing mortgage lenders under the Office of the Comptroller of the Currency (OCC), a unit of the Department of the Treasury:
- Office of Thrift Supervision (OTS; unit of Department of the Treasury)
- Federal Deposit Insurance Corporation (FDIC; supervises insured institutions)
- Federal Reserve Board (FRB; principal agency supervising financial health)
- National Credit Union Administration (NCUA; regulates federal credit unions)
- Federal Trade Commission (FTC; resolves issues involving credit reporting agencies)
- Farm Credit Administration (FCA; regulates financial entities lending within the Farm Credit System including the Federal Agricultural Mortgage Corporation–Farmer Mac)
- Department of Housing and Urban Development (HUD) (issues the rules to insure—and effectively regulates—-FHA Loans).
It is easy to see how regulation procedures could become lax. There are too many regulatory agencies, and they are tripping over each other’s feet. Officials from President Obama’s administration believe this lack of strength on the part of federal regulatory authorities was critical to the advent of financial crisis.
If You Have a complaint against a lender:
You may file a complaint regarding fraud or a scam with the Bureau of Consumer Protection of the Federal Trade Commission (FTC) enforces a variety of consumer protection laws protect consumers against unfair, deceptive, or fraudulent practices.
List of federal agencies that review compliance by particular types of lenders:
- Board of Governors of the Federal Reserve System (FRS) oversees state-chartered banks and trust companies that belong to the Federal Reserve System.
- Federal Deposit Insurance Corporation (FDIC) regulates state-chartered banks that do not belong to the Federal Reserve System.
- Office of the Controller of the Currency (OCC) regulates banks that have the word “National” in or the letters “N.A.” after their names.
- National Credit Union Administration (NCUA) regulates federally charted credit unions.
- Office of Thrift Supervision (OTS) oversees federal savings and loans and federal savings banks.
- Bureau of Consumer Protection (BCP) handles other lenders.
If you need help in deciding whom to contact with your consumer problem, the Federal Citizen Information Center of the U.S. General Services Administration (1-800-FED-INFO) has compiled a list of Federal agencies where you can document a complaint against a company….Good luck!
State Insurance Regulators Each state has its own laws and regulations for all types of insurance, including car, homeowner and health insurance. Many of these offices can provide you with information to help you make informed insurance buying decisions.
To file a complaint about prospective lenders making unsolicited calls to you with the National Do Not Call Registry, your phone number must have been on the registry for three months.
For other sources of assistance, please refer to the Consumer Action Website.
Ok…Well, that’s about it…until I find more to add…
References to products and services are not a specific endorsement, but the user must perform their due diligence and investigate whether the product or service is right for them. I welcome any or all comments that would help others.