CFPB to Tackle World’s Oldest Profession; Top Lenders Form Private Club; GSE’s End HARP

The NMLS turned some heads late last week
with its latest press release. “At NMLS, We are doing our part to help the
mortgage industry! We enhanced our systems to provide you with more oversight
and confusion, resulting in additional wasted time for compliance. If you don’t
have a full-time person dedicated to NMLS, support the economy and hire one
now! In addition, thank us for all the jobs we have created with your local
government. Someone has to review all the stuff you enter. At NMLS, we are
working hard to make a confusing website that doesn’t follow standard
programming rules to make you consider getting more computer education. We even
host a conference to teach you our system. Look at the jobs we have created!
Dreaming up unnecessary compliance and making it complicated, just one of the
ways we at NMLS contribute to the industry.” Soon after the release was
announced Texas threatened to secede from the United States.

In an unheralded move, the top 5-15
lenders for 2011 have formed a club
. “We haven’t had this much fun
since Indymac and WAMU were competing for our stated-stated loans at a price of
105” said one CEO. U.S. Bank,
Ally/GMAC, PHH Mortgage, Quicken Loans, Flagstar Bank, Provident Funding,
BB&T, MetLife, Fifth Third Mortgage, SunTrust Mortgage, and Franklin
American
are all as giddy as schoolgirls at the prospect. When organizers
were reminded that MetLife is no longer in the mortgage business, they replied,
“That’s cool – we’re all one big happy family.” Apparently this group
of mid-sized lenders has grown weary of larger players coming and going,
buybacks, and being lumped in with anyone worried about Basel III.

The club plans to do its own servicing, issue its own securities, map out its
own underwriting guidelines, and even have its own secret conferences. One
source, requesting anonymity, stated, “We’re going to have our conferences
in Kansas – which is both in the middle of everything and in the middle of
nowhere. And it is supposed to get the internet in 2013, which ties in nicely
with our plans. We’re tired of those MBA shindigs in expensive places with
lousy airports – and those fancy restaurants don’t hold a candle to Arthur
Bryant’s BBQ. We’re going to create ‘Lender Town’ as a permanent conference
center – we’ll really be able to let our hair down. It’ll be modeled after
Disneyland, with a submarine ride to see the underwater houses. And instead of
Abe Lincoln giving the Gettysburg Address, we’re going to have a statue of Andrew
Cuomo giving a speech from 2001 about how the government needs to increase home
ownership.”

The CFPB has spread the word that it
is hiring in order to staff up for its next project. “Word comes to us
that a borrower who actually read the 78 page simplified disclosure package
found 12 misspellings, 4 missing punctuation marks, and a very risqué double
entrede,” announced spokesman T. Hood. Soon after the release was
announced Texas threatened to secede from the United States.

And in a surprise move, the CFPB
announced that it has ceased auditing mortgage companies and will instead turn
its attention to brothels
. One source said, “Look, mortgage lenders
have been audited by every 3 or 4 letter government agency in existence.
They’re people too! How many cavity searches can one’s operations department go
through? Besides, it isn’t much of a
stretch since consumers and finances are involved
. If you’re an auditor
with the CFPB, would you rather be in a room with some haggard middle-aged
mortgage banker or…” Consumer complaints in this segment of the
entertainment industry have been too numerous to count. “She promised one
thing, and I got something entirely different” said one complaint.
“The Good Faith was questionable, there was no recission period, and they
didn’t honor their price” said another. “The disclosure paperwork in
that industry will warrant a close examination,” said one spokesman. It is
rumored that the CFPB’s first audit will be Kitty’s Fun House, east of Reno,
and the audit could take 24-36 months. Kitty was unavailable for comment.

The Bureau
of Financial & Underwriting Accounting Standards answered critics who are,
senselessly, asking for financial accountability. These critics ask,
“Speaking of FICO scores, one
wonders what the FICO score would be for the federal government given it is $14
trillion in debt?
  Better yet, what’s the federal government’s DTI?
Would the federal government qualify for the QRM’s they are going to push on
all the lenders?” Soon after the release was announced Texas threatened to
secede from the United States, claiming that this is worse than cash out refi’s.

Fanny May, founded in 1920, is suing
Fannie Mae, founded in 1938
, claiming that the mortgage company horned in
(a legal term) on its name. The candy company has witnessed the mortgage
industry brought to its knees by litigation and hundreds of high profile
lawsuits, and wants no part of it. “We’re tired of people wandering in off
the street and asking about HARP. What the heck is that?” noted spokesman
Benjamin Brian. “Everyone is making money off this mortgage thing, and
although record numbers of Americans are obese the candy business is suffering
– so why not grab a slice of mortgage money pie?”

Not to be outdone, Freddie Mac’s legal
team is suing the rest of Freddie Mac
, and on a contingency basis. Details
had yet to be announced as of press time.

And also not to be outdone, Webster’s
Dictionary is suing the entire mortgage industry
, claiming that
“writedown,” “casefile,” and “homeowner” are all
actually two words. “Pretty soon we’ll all be using the word
“get” and ending sentences in prepositions – and then where would we
be at?” asked attorney Tom Carney.

In a related but unrelated matter, Maxine
Waters (D – CA) has announced a plan to forgive all mortgage debt in 47 states
.
It was not clear, however, which 47 states are included in the plan. “This
is America, and we need to show the world that borrowing money and signing
legal documents carry no weight whatsoever. And as for the 3 states that aren’t
included…well, let them figure it out.” Soon after the release was
announced Texas threatened to secede from the United States.

Mortgage companies everywhere have noted that Freddie and Fannie have stopped offering the HARP 2.0 program.
“It is just another useless 4-letter acronym, and most people don’t even
remember what the letters stand for” spokesman Melva Storke noted.
“The first version of HARP suffered because it excluded homeowners whose
homes were valued more than 25% below the loan amount as well as borrowers who
may have missed a mortgage payment in the last year. These ineligible Americans
were over-represented in the areas of the country that were hardest hit by the
Great Recession. And the GSE’s, in spite of prodding by the FHFA and Congress,
don’t want to be on the hook for this stuff. Besides,” added Ms. Storke, “HARP
2.0 has too many problems to be a decent program that the agencies want
associated with them. The new HARP does not permit borrowers who have already
refinanced through the program to use it again – if the first HARP helped
improve the situation for a homeowner in 2009, 2010 or 2011, then why should
the government deny them the chance to improve their situation further now? And
this whole date thing is confusing, limiting eligibility to homeowners whose
loans were purchased prior to May 31, 2009. This makes no sense. Besides, why would anyone take out a new loan when
the Secretary of the Treasury is trying to twist Fannie & Freddie’s arm in
reducing everyone’s principle?”

It has been discovered that a little
known provision in the Dodd-Frank Act requires all FDIC insured institutions to
honor mortgages and liens “written on any living animal.”
Legislators
aren’t certain how the provision made it into the final bill, but believe it
was an intentional slight by an analyst, in response for having to put the
Durbin Amendment in. Whatever the explanation, MERS and servicers aren’t
laughing. “This has become a real headache,” said MERS spokesperson Christopher
Riley. “At first, it was just a few cows, but when folks here got wind of it,
they started bringing in whole barnyards. Right now we’ve got four cows,
twenty-one chickens, seventeen hogs, three mules, and a goat.” The problem
isn’t limited to rural institutions. “We’re seeing more and more of it,” said Scott
Short, President of San Francisco Federal Thrift & Loan. “Dogs, cats,
hamsters, snakes…you name it. Sometimes these animals shed their skins and some
eat each other. Then what do you do?” Fraud has also been a problem. “We had to
sell a mortgage written on a bird,” said Mr. Short, “The first chance the
pigeon had, it then flew right out the window.” This still small but growing
practice has also impacted shipping departments around the nation, clogging
already-backlogged operations departments by having to ship live animals to the
aggregators. Dave Stevens, President of the MBA, recently testified before
Congress, “Our members’ back offices were not designed with animal husbandry in
mind. If you thought robo-signing was a nightmare, try having the CFPB audit a
room full of monkeys.”

In
financial news, the Greek government narrowly missed out solving its debt
issues after a junior aid made a numerical mistake. It turned out that the Prime
Minister of Greece traveled to a convenience store in Terra Haute, Indiana to
purchase a Mega Millions lottery ticket.
Needless to say, the trip raised many eyebrows among financial ministers across
the Eurozone. Prime Minister Lucas Papademos made the extraordinary purchase
himself, traveling to a 7-11 in Indiana to buy a ticket. After buying the
ticket, he was quoted as saying, “Winning will allow us to pull the
proverbial rabbit from out of the hat. We are not afraid of the odds of winning
the jackpot. 1 in 176 million is much better than the odds experts give us of
solving our own financial problems, which are approximately 1 in 975
gazillion.” The country’s hopes were dashed, however, when an aide used
the cabinet’s birthday numbers using the Greek Orthodox calendar rather than
the Julian calendar for the picks. “If it hadn’t been for that, we’d have
been flying back in first class!” Papademos said wistfully.

Turning to the markets, the economy is going to improve slowly. The economy is
also going to improve fast. Or vice-versa. It will definitely be one or the
other. Or something in between. It’s just an issue of sooner or later, more or
less. The opposite is probably true, too. Even so, no matter how gradual the
improvement, it will be sudden. The economy will stall around the third
quarter, before Halloween, then build momentum through the rest of 2012,
reverse course in 2013, then pause for a cigarette break. Whatever the case,
the economy is headed in the right direction, roughly east by southeast. This
comes to us from a new predictive algorithm from the CFPB.

The good news here is that the recovery is fully underway. The bad news is that
the recovery will most likely take the rest of our lives. In fact, once we
finally do turn the corner, we’ll still have to turn another corner, and then
at least two more, only to bring ourselves full circle, a phenomenon MBA
economists call “cyclical.” In short, the only rebound that will
happen this year will take place on a basketball court like last night. All
signs point to that scenario, even though our mother always told us it’s rude
to point. Evidence to that effect is considerable. Some companies looking to
scale back payrolls will now offer early retirement packages only to employees
who have recently died. Anyone who has lost a job since the recession began can
now get a tax credit toward retaining a private investigator to try to find it
for you. And the private sector is increasingly making fun and pointing at the public
sector.

Economists
at Fannie Mae and Freddie Mac say all of these are surefire signs of a surging
economy. Until they aren’t. To be sure, the dollar is still weak, driving up
gasoline prices, but reports have come in from Europe that it has started doing
some cardio and eating more cruciferous vegetables. (Use a dictionary.) And
though it’s already a given that the recovery may be jobless, it now appears
likely it will also be shirtless and hairless as well.

For today’s joke, you can read any of
the sentences above.

…(read more)

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