DS News

62 » Continued steady improvement of overall mortgage market. » Delays in growth as the industry struggles to adapt to regulatory changes (see above). » HELOCs are seen as a great opportunity for growth, but there is significant competition. » Insurance defaults have begun to rise from their historic lows. » We're seeing a significant increase in insurance losses due to extreme weather throughout the country. ese losses are offsetting the lack of a catastrophic event. » We will see a greater default in flood insurance from borrowers due to the dramatic rate increases for NFIP policies. » We expect to see higher flood claims and weather related losses this winter due to the extra moisture and storms in the heavily populated south and southern California. » Continue to see changes in tracking and lender placed relationships due to servicing issues and legal settlements. Challenges are nothing new to our industry. Necessity being the mother of invention, once again our innovation, resolve, and resourcefulness will move our industry forward and 2016 will be another banner year. COVER FEATURE COMPLIANCE NEAL DOHERTY Managing Director of Compliance Solutions, Walz Group We expect the regulatory environment to become even tighter next year, with a major contributing factor being enhanced coordination between state and federal regulators. is will equate to increased scrutiny from both state and federal regulators, more enforcement actions, and the requirement of mortgage servicers to dedicate even more resources to compliance. One of the major consequences of Dodd-Frank was how it changed the roles of the regulators. Before Dodd-Frank, banks frequently and successfully argued that state laws were preempted by federal law. Dodd- Frank made it harder to assert preemption, and also granted the state Attorneys General and other state regulators additional authority to bring civil actions to enforce the law. ese changes fundamentally increased the importance of the states in the regulatory process, and have led to increased cooperation between federal and state agencies. A recent and significant example of this increased cooperation occurred on November 4, 2015, when the Federal Trade Commission ("F TC") and state regulators, including the Illinois Attorney General and the Commissioner of the Minnesota Commerce Department, announced a nationwide crackdown on abusive debt collection practices. Involving over 70 law enforcement partners, "Operation Collection Protection" would be the "first coordinated federal-state enforcement initiative targeting deceptive and abusive debt collection practices," according to the F TC. Illinois Attorney General Lisa Madigan, who is extremely active in consumer protection issues, touted her state's partnership with the FTC as a vital tool in "putting scam operations out of business and protecting consumers from abusive practices by legitimate creditors." Madigan has not been shy about using her new powers granted under Dodd-Frank, and has brought multiple lawsuits against debt collectors and predatory lenders. Minnesota Commerce Commissioner Mike Rothman added, "By work ing together in this new federal-state collaboration, we are joining our forces to stop these abusive practices and protect the public." Previously, state regulators such as Rothman may have been limited by the law of their own states because, in many states, the attorney general is the only state off icial empowered to bring an action for an unfair or deceptive act or practice. Dodd-Frank, however, extended this power such that a variet y of state regulators can bring these t y pes of actions. is recent, FTC-coordinated action builds on a number of past joint enforcement actions starting with the 2012 National Mortgage Settlement involving the country's five largest mortgage servicers. We expect this coordination to increase over the next several years, leading to further public and private enforcement actions, as the federal agencies and state regulators share information and cooperate to achieve common policy goals. COVER FEATURE TITLE THOMAS KLEIN SVP, National Agency Division WFG National Title Insurance Company Although we are aware of forecasts suggesting a similar or even slightly decreased origination market for 2016, we believe that the coming year could also hold a pleasant surprise or two. Although the implementation of the TILA-RESPA Integrated Disclosures rule has caused some disruption, and will likely do so into early 2016, the uncertainty surrounding it will be gone. e biggest chilling factor to face the mortgage industry in 2015 was uncertainty. Uncertainty as to how TRID would be enforced. Uncertainty as to when the rule would actually be implemented. Uncertainty as to what our clients (such as mortgage lenders) would require of their partners to comply with the rule. at uncertainty should now be gone. Our industry has been mired in a rapidly- changing regulatory environment for a few years now. Overall, the cost of doing business has gone up as we work to adapt to new requirements and constraints. I don't COVER FEATURE Cover Feature: 30 Top Executives Tell You The Future Cover Feature: 30 Top Executives Tell You The Future Cover Feature: 30 Top Executives Tell You The Future EXPERT OPINION The real wild card for 2016 will be compliance. What new regulations or laws could insert uncertainty into the industry after TRID? –THOMAS KLEIN

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