By the Division of Banks
COMMONWEALTH OF MASSACHUSETTS
COMMISSIONER OF BANKS
Docket No. 2011-010
In the Matter of
Nationstar Mortgage LLC
Mortgage Lender License No. ML2119
WHEREAS, NATIONSTAR MORTGAGE LLC, Lewisville, Texas ("Nationstar" or the "Company"), a licensed mortgage lender 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 November 30, 2011, 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, Nationstar agrees to the issuance of this CONSENT ORDER ("Order") by the Commissioner of Banks ("Commissioner");
WHEREAS, a Mortgage Lender Community Investment examination of Nationstar was conducted pursuant to General Laws chapter 255E, section 8, as of November 1, 2010, to assess the Company’s level of compliance with applicable Massachusetts statutes and the Division’s regulations governing the conduct of those engaged in the business of a mortgage lender in the Commonwealth; and
WHEREAS, the Report of Examination (the "Report") issued pursuant to the Division’s examination of Nationstar as of November 1, 2010 alleged non-compliance with certain applicable state and federal statutes, rules, and regulations governing the conduct of those engaged in the business of a mortgage lender in Massachusetts.
NOW COME the parties in the above-captioned matter, the Division and Nationstar, and stipulate and agree as follows:
- Nationstar shall further enhance, 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 Regulations of the Board of Governors of the Federal Reserve System, 12 C.F.R. Part 203 ("Regulation C"). Such procedures shall necessarily require that the Company implement internal controls to ensure that, for all HMDA reportable loan applications, Nationstar accurately compiles and records all required data in the Company’s HMDA Loan Application Register ("LAR").
- Within ninety (90) days of the effective date of this Order, Nationstar shall further enhance, 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 Nationstar pursuant to this Section of the Order.
- Nationstar agrees to submit a payment in the amount of twenty-five thousand dollars ($25,000.00) in satisfaction of an administrative penalty collected in consideration of the Company’s alleged failure to comply with the statutes, rules and regulations governing the conduct of those engaged in the business of a mortgage lender in Massachusetts. Nationstar 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, 1000 Washington Street, 10th Floor, Boston, Massachusetts 02118. The Division shall remit the payment for deposit into the General Fund of the Commonwealth.
- Nationstar shall comply with all Federal and Massachusetts laws and regulations applicable to conducting the business of a mortgage lender, 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 thirty (30) days of receipt of the Report, all alleged violations and areas of concern addressed in the Report.
- Within thirty (30) days of Nationstar’s receipt of the Report, the Company shall submit to the Commissioner a written response that addresses each of the alleged violations and areas of concern specified in the Report. The written response shall describe the revised policies and procedures adopted by Nationstar to implement all corrective actions set forth in: (i) the "Significant Violations" section of the Report; and (ii) the provisions of this Order;
- Within thirty (30) days of the effective date of this Order, Nationstar shall further enhance, establish, implement, and maintain quality control standards which provide for a loan review process to assess the Company’s compliance with: (i) the statutes, rules, regulations, regulatory bulletins, and other relevant provisions of law applicable to those engaged in the business of a mortgage lender in Massachusetts, and (ii) the provisions of this Order. Such quality control standards shall be designed to prevent the occurrence of the alleged violations addressed in the Report; and
- Nationstar shall further enhance, 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 Order.
- On the thirtieth (30th) day after the end of each calendar quarter following the date of this Order, beginning with the calendar quarter ending December 31, 2011, Nationstar 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 Order and the results thereof; and
- Written findings prepared by Nationstar detailing a review of management’s and staff persons’ adherence to the policies, programs, and procedures adopted pursuant to this 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 Nationstar’s compliance condition in Massachusetts as it relates to matters addressed in the Report and the results thereof.
- The reporting requirement to the Division referenced in Section 3 of this 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 Order from the Commissioner.
- Nothing in this Order shall be construed as permitting Nationstar to violate any law, rule, regulation, or regulatory bulletin to which the Company is subject.
- In consideration of the foregoing Order, the Division agrees not to pursue formal measures, relative to this matter, to suspend or revoke Nationstar’s mortgage lender license under Massachusetts General Laws chapter 255E, section 6, while this Order is in effect.
- Nationstar agrees that, in the event the Company fails to submit the payment set forth in this Consent Order in the amount specified herein and in accordance with the applicable deadline, the Division shall be authorized to submit a claim for such amount against the mortgage lender Massachusetts surety bond maintained by Nationstar pursuant to the Division’s regulation 209 CMR 42.03(2)(a).
- Failure to comply with the terms of this 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 Order shall become effective immediately upon the date of its issuance.
- The provisions of this Order shall remain effective and enforceable except to the extent that, and until such time as the Commissioner or a court of competent jurisdiction modifies, terminates, suspends, or sets aside any provision of this Order.
- This Order and the Consent Agreement are the complete documents representing the resolution of this matter. There are no other agreements between the Division and Nationstar.
BY ORDER AND DIRECTION OF THE COMMISSIONER OF BANKS.
Dated at Boston, Massachusetts, this 30th day of November, 2011
David J. Cotney
Commissioner of Banks