Regulatory Burden and Compliance Tackled by Industry Experts

With regulatory oversight continuing to weigh heavier on the mortgage industry, compliance may be the only solution to avoid fines and penalties.

Compliance obligations stemming from the Consumer Financial Protection Bureau (CFPB), Office of the Comptroller of the Currency (OCC), the National Mortgage Settlement, states' Homeowner Bill of Rights, client audits, and individual investor guidelines can be a heavy burden to bear in the housing sector.

With the CFPB prepping to unleash the highly anticipated TILA-RESPA Integrated Disclosure rule in two weeks on October 3, the industry is about to be hit with more changes that must be met with compliance.

With all of this in mind, it is more crucial than ever to stay ahead of the curve and prepare for the path ahead of us.

In the Compliance Lab at the 2015 Five Star Conference on September 17 at the Hilton Anatole in Dallas, Texas, panelists from all facets of the mortgage industry discussed topics that got to core of compliance.

"Its tough being in an industry where the federal government blames you all the time. Perfection is a hard goal to achieve."

In the lab, which was hosted by AspenGrove Solutions and co-hosted by 5 Arch Code Compliance, ShortSave, and Walz Group, the experts provided a TILA-RESPA update, compliance management programs, CFPB enforcement actions, and Section 342 of the Dodd-Frank act.

Lab director and Chief Compliance Officer of Bayview Loan Servicing Michael Waldron, opened the discussion with a brief update on the industry-wide compliance.

"The industry, while it has taken its hits, does stay ahead of issues and addresses them accordingly," he said.

Donna Clayton, SVP, chief compliance officer, LenderLive, defined proactive compliance in the panel and revealed how her company includes this concept into their business structure.

"Proactive compliance embraces a holistic view," Clayton explained. "Everything must work together. You cannot mitigate risk, you must have a working system to follow."

She added, "LenderLive makes compliance a part of our culture, we have an entire team dedicated to ensuring we are compliant."

Waldron went further to say that companies must "allow compliance to be woven into the fabric of their business."

Bob Caruso, division president of ServiceLink, a Black Knight Company delved into the methods his company uses to ensure compliance. He noted that his company uses extensive methods to keep all of their employees in code and has quality controls such as a business group, compliance group, and risk, audit, and legal group.

Ed Buckley, president of AspenGrove addressed regulatory issues, explaining that "a regulated entity can outsource the work, but not the risk associated with the work."

He further noted that in order to keep regulation of you back, "compliance actions need to documentable, provable, and written down.

Roy Diaz, a shareholder at SHD Legal Group found that "its tough being in an industry where the federal government blames you all the time. Perfection is a hard goal to achieve."

Edward Kramer, EVP of Regulatory Affairs at Wolters Kluwer also explained in the lab that regulation today is "cloudy with a chance of rain."

Although regulation could possibly rain down on consumers an d businesses, "the American dream of owning a home is still alive and well."

Editors note: The Five Star Institute is the parent company of MReport and MReport.com.