By the Division of Banks
COMMONWEALTH OF MASSACHUSETTS
COMMISSIONER OF BANKS
MORTGAGE LENDER AND
MORTGAGE BROKER LICENSING
Docket No. 2012-033
In the Matter of
NORTHPOINT MORTGAGE, INC.
Mortgage Company License No(s). MC1515 et al.
WHEREAS, NORTHPOINT MORTGAGE, INC., Sturbridge, Massachusetts (NorthPoint Mortgage or the Corporation), a licensed mortgage lender and mortgage broker under Massachusetts General Laws chapter 255E, section 2, has been advised of its right to Notice and Hearing pursuant to General Laws chapter 255E, section 7(a), and having waived those rights, entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF A CONSENT ORDER (Consent Agreement) with representatives of the Division of Banks (Division) dated January 2, 2013, whereby, solely for the purpose of settling this matter, and without admitting any allegations or implications of fact or the existence of any violation of state or federal laws and regulations governing the conduct and operation of a mortgage lender or mortgage broker, NorthPoint Mortgage agrees to the issuance of this CONSENT ORDER (Consent Order) by the Commissioner of Banks (Commissioner);
WHEREAS, an examination of NorthPoint Mortgage was conducted pursuant to General Laws chapter 255E, section 8, as of October 27, 2011, to assess the Corporation’s level of compliance with applicable Massachusetts and federal statutes and regulations governing the conduct of those engaged in the business of a mortgage lender and mortgage broker in the Commonwealth; and
WHEREAS, the Report of Examination (Report) issued pursuant to the Division’s examination of NorthPoint Mortgage as of October 27, 2011, alleged substantial non-compliance with applicable state and federal statutes, rules, and regulations governing the conduct of those engaged in the business of a mortgage lender and mortgage broker in Massachusetts.
NOW COME the parties in the above-captioned matter, the Division and NorthPoint Mortgage, and stipulate and agree as follows:
- NorthPoint Mortgage shall establish, implement, and maintain procedures to ensure compliance with the loan reporting requirements set forth in the Home Mortgage Disclosure Act (HMDA), 12 U.S.C. section 2801 et seq., as implemented by Consumer Financial Protection Bureau’s regulation 12 C.F.R. Part 1003 (Regulation C). Such procedures shall require that the Corporation implement internal controls to ensure that, for all HMDA reportable loan applications, NorthPoint Mortgage accurately compiles and records all required data in the Corporation’s HMDA Loan Application Register (LAR).
- Within sixty (60) days of the effective date of this Consent Order, NorthPoint Mortgage shall review for accuracy the HMDA data collected for all Massachusetts residential mortgage loan applications originated during calendar year 2010, and shall petition the Federal Reserve Board to permit a re-filing of corrected information of all erroneous and/or incomplete data previously submitted on the LAR.
- NorthPoint Mortgage shall establish, implement, and maintain operating policies and training procedures to ensure that all applicable personnel possess a comprehensive understanding of the HMDA reporting requirements under Regulation C. Such training shall necessarily ensure the proper implementation and execution of the revised practices and procedures adopted by NorthPoint Mortgage pursuant to this Section of the Consent Order.
- Within ninety (90) days of the effective date of this Consent Order, NorthPoint Mortgage shall prepare and submit to the Division a written report detailing the HMDA data that the Corporation filed pursuant to Section 1(a) of this Consent Order.
- NorthPoint Mortgage agrees to submit a payment in the amount of ten thousand dollars ($10,000.00) in satisfaction of an administrative penalty collected in consideration of the Corporation’s failure to comply with the statutes, rules and regulations governing the conduct of those engaged in the business of a mortgage lender in Massachusetts. NorthPoint Mortgage shall remit payment in full of the amount indicated above, payable to the "Commonwealth of Massachusetts," with the executed copy of the Consent Agreement, to the Office of the Commissioner of Banks, Attn: Mortgage Lender Examination Unit, 1000 Washington Street, 10th Floor, Boston, Massachusetts 02118.
- NorthPoint Mortgage shall establish, implement, and maintain procedures to ensure that the Corporation files its completed LAR to the agency office specified in Appendix A of Regulation C by March 1st following the calendar year for which the loan data are compiled pursuant to Regulation C, part 1003.5 (a)(1). NorthPoint Mortgage shall retain a copy of the completed LAR in its records for at least three years from the date of submission.
- NorthPoint Mortgage shall establish, implement, and maintain procedures to ensure that the Corporation files all quarterly reports on a timely basis pursuant to the Division’s regulation 209 CMR 42.09(4). It is understood that beginning with the first calendar quarter of 2011, the Mortgage Call Report (Call Report), collected through the Nationwide Multi-State Licensing System & Registry (NMLS), replaced the Massachusetts quarterly report. The quarterly reporting requirement will be satisfied by completing and submitting the Call Report, and uploading interim quarterly financial statements to the NMLS, in accordance with applicable filing instructions and within prescribed timeframes.
- NorthPoint Mortgage shall comply with all laws and regulations applicable to its conducting the business of a mortgage lender and mortgage broker, including, but not limited to, Massachusetts General Laws chapters 255E and 255F, and the Division’s regulations 209 CMR 41.00 et seq. and 209 CMR 42.00 et seq. Such obligations shall necessarily include the duty to address and correct, within twenty (20) days of receipt of the Report, all violations and areas of concern addressed in the Report.
- NorthPoint Mortgage submitted to the Commissioner a written response to the Report describing the corrective measures to be undertaken by NorthPoint Mortgage to address each of the violations and areas of concern specified in the Report;
- Within thirty (30) days from the effective date of this Consent Order, NorthPoint Mortgage shall establish, implement, and maintain quality control standards which provide for a loan review process to assess the Corporation’s compliance with: (a) the statutes, rules, regulations, regulatory bulletins, and other relevant provisions of law applicable to those engaged in the business of a mortgage lender and mortgage broker in Massachusetts; (b) the revised policies and procedures described in NorthPoint Mortgage’s written response to the Report; and (c) the provisions of this Consent Order. Such quality control standards shall be designed to prevent the recurrence of the violations addressed in the Report; and
- NorthPoint Mortgage shall establish, implement, and maintain procedures and policies to ensure that all applicable staff persons receive adequate instruction and ongoing, periodic training to ensure proper implementation and execution of the revised practices and procedures implemented pursuant to this Consent Order.
- On the thirtieth (30th) day after the end of each calendar quarter following the date of this Consent Order, NorthPoint Mortgage shall furnish written progress reports to the Division, which shall address and include the following:
- A description of the form, content, and manner of any actions taken to address each Section of this Consent Order and the results thereof; and
- Written findings prepared by NorthPoint Mortgage detailing a review of management’s and staff persons’ adherence to the policies, programs, and procedures adopted pursuant to this Consent Order and to applicable statutes, regulations, and rules, as well as a description of any operational changes implemented during such quarter which are intended to improve NorthPoint Mortgage’s compliance condition in Massachusetts and the results thereof.
- The reporting requirement to the Division referenced in Section 5 of this Consent Order shall remain in effect and shall not be amended or rescinded without the prior written modification, termination, or suspension of the applicable provision of this Consent Order from the Commissioner.
- NorthPoint Mortgage agrees that, in the event that the Corporation fails to submit the payments set forth in this Consent Order in the amounts specified herein and in accordance with the applicable deadlines, the Division shall be authorized to submit a claim for such amounts against the mortgage lender and/or mortgage broker Massachusetts surety bond maintained by NorthPoint Mortgage pursuant to the Division’s regulations 209 CMR 42.03(2)(a).
- Nothing in this Consent Order shall be construed as permitting NorthPoint Mortgage to violate any law, rule, regulation, or regulatory bulletin to which NorthPoint Mortgage is subject.
- In consideration of the foregoing Consent Order, the Division agrees not to pursue formal measures, relative to this matter, to suspend or revoke NorthPoint Mortgage’s mortgage lender and mortgage broker licenses under General Laws chapter 255E, section 6, while this Consent Order is in effect.
- Failure to comply with the terms of this Consent Order shall constitute grounds for license suspension and/or revocation, or other formal regulatory action pursuant to applicable provisions of the General Laws of the Commonwealth of Massachusetts.
- This Consent Order shall become effective immediately upon the date of its issuance.
- The provisions of this Consent Order shall remain effective and enforceable except to the extent that, and until such time as, any provisions of this Consent Order shall have been modified, terminated, suspended, or set aside by the Commissioner or upon an Order of a court of competent jurisdiction.
- This Consent Order and the Consent Agreement are the complete documents representing the resolution of this matter. There are no other agreements, promises, representations, or warranties between the Division and NorthPoint Mortgage.
BY ORDER AND DIRECTION OF THE COMMISSIONER OF BANKS:
Dated at Boston, Massachusetts, this 2nd day of January, 2013
David J. Cotney
Commissioner of Banks
Commonwealth of Massachusetts