CFPB Bites of the Month: Mortgage QC Industry Trends

Abrupt increases in mortgage rates and decrease of production and loan volumes has allowed lenders to focus on loan quality and salability to investors. The overall critical defect ended Q1 2022 at 1.93%, representing a .02% decline from Q4 2022. Q2 2022 purchases alone, accounted for 77.24% of all faults, up 28% from the share of 60.18% in the prior quarter, while refinances accounted for 22.76% of defects this quarter.

Other regulatory organizations have followed the Consumer Financial Protection Bureau (CFPB), which has been vocal and active in recent years regarding its expectations and concerns regarding compliance issues relating to equity and fairness in the lending process including Fannie Mae. Fannie Mae updated its QC reporting guidelines, with additional changes expected to come in 2023.

Having the proper quality control systems in place helps lenders stay on top of significant regulatory and investor developments.

Spillane Consulting Associates’ consulting team can offer several types of assessments, (origination, operational, servicing, compliance etc.) Spillane Consulting Associates has a successfully proven mortgage quality control (QC) reporting review assessment in accordance with regulatory and federal guidelines. For any questions, comments, or inquiries, please reach out to us.