Browse articles from all of our Newsletters related to Delinquency.

March 17, 2017 - Inside FHA/VA Lending

Utah FHA Lender Pays $4.25 M to DOJ, HUD to Resolve Fraud Claims

Security National Mortgage Co. of Salt Lake City has paid $4.25 million to the Department of Housing and Urban Development to settle allegations of failing to comply with FHA loan requirements. Security National, a retail lender, has been an FHA-approved direct endorsement lender since October 1993, the year it was founded. The settlement resolves a joint civil investigation by the HUD Office of the Inspector General, Department of Justice and the U.S. Attorney’s Office for the District of New Jersey into Security National’s FHA origination and underwriting practices in connection with 100 FHA-insured loans. As part of the settlement, the lender “agreed it engaged in certain conduct in connection with its origination and underwriting of the loans.” The HUD OIG provided no details about the investigation. The OIG said the loans that were certified as compliant would not have been insured had ...

March 17, 2017 - Inside FHA/VA Lending

Georgia Appeals Court Finds for Wells Fargo in Provisional Win

A Georgia appellate court recently handed Wells Fargo Bank a provisional win in a lawsuit in which a VA borrower alleged breach of contract and wrongful foreclosure. In Wells Fargo Bank, N.A., d/b/a Wells Fargo Home Mortgage v. LaTouche, the court ruled that Wells did not breach its duty to the borrower to comply with VA foreclosure regulations. The court concluded that the trial court had erred in denying Wells Fargo’s motion for summary judgment as to the defendant’s claims for wrongful foreclosure that hinged upon the same VA regulations. The reversal stemmed from Wells Fargo’s request for an interlocutory review of the trial court’s denial of its motion for summary judgment on defendant Michael LaTouche’s claims for breach of contract, wrongful foreclosure and “surprise. An interlocutory review is undertaken when a question of law must be answered by an appellate court before ...

March 17, 2017 - Inside FHA/VA Lending

Quicken Loans Notches First Win After Court Narrows Scope of Case

A favorable court ruling on the statute of limitations for filing claims under the False Claims Act gave Quicken Loans its first win in a closely watched government case involving allegedly fraudulent FHA loans. Judge Mark Goldsmith of the U.S. District Court for the Eastern District of Michigan dismissed portions of the Department of Justice’s lawsuit against Quicken in a March 9 decision, narrowing the lender’s potential liability for FHA losses. The losses were blamed on sloppy underwriting, fraudulent certification and loan performance. The DOJ said the FHA would not have knowingly insured the loans had it known they were defective. The DOJ and the Department of Housing and Urban Development’s inspector general began an investigation of Quicken’s FHA lending activities in April 2012. The investigation encompassed some 246,000 FHA loans, which Quicken originated from ...

March 16, 2017 - Inside Mortgage Finance

FCC Weighs Revised Phone-Contact Standards That Could Interfere with Mortgage Business

A request from two consumers for changes to the Telephone Consumer Protection Act would interfere with mortgage origination and servicing operations, according to the Consumer Mortgage Coalition. The CMC submitted a comment letter to the Federal Communications Commission late last week in response to a petition submitted to the FCC in January. The petition called for the FCC to re-write parts of the TCPA and require express consent to be in writing from consumers regarding certain communications from companies, including mortgage lenders and servicers. The petition would define express consent as not being provided even when a person to be called knowingly provides a phone number to a lender on a loan application. Anne Canfield, executive director of the CMC, said...

March 9, 2017 - Inside Mortgage Finance

HFSC’s Budget Views Lay Groundwork for Carson’s HUD Agenda as Secretary Prepares for ‘Listening’ Tour

Secretary Ben Carson may not yet have a clear agenda and a set of priorities for the Department of Housing and Urban Development over the next four years, but the House Financial Services Committee appears to have identified changes that Republican lawmakers want to see at the agency. A HUD spokesman said Carson will embark next week on a nationwide “listening” tour of certain communities and HUD field offices to learn more about the agency he leads, FHA programs and the mortgage insurance fund he oversees. On March 2, Vice President Mike Pence swore...

March 3, 2017 - Inside FHA/VA Lending

Public Disclosure of Misconduct May Bar Specific Claims of Fraud

Relators in a False Claims Act lawsuit must allege misconduct that has not already been publicly disclosed or risk dismissal of their qui tam claims, according to the U.S. Appeals Court for the Sixth Circuit. In U.S. ex rel. Advocates for Basic Legal Equality, Inc. v. U.S. Bank, the court ruled that whistleblowers cannot raise “substantially the same allegations or transactions” that have been previously alleged in an action or claim and publicly disclosed. The qui tam plaintiff must be the original source of the allegations, the court said. Only certain disclosures trigger the prohibition, the court noted. They include disclosures “in a federal criminal, civil or administrative hearing in which the government or its agent is a party,” or in a Government Accountability Office or other federal report, hearing, audit or investigation, or from the news media. n this case, the relator/plaintiff alleged that U.S. Bank initiated foreclosure proceedings ...

March 3, 2017 - Inside FHA/VA Lending

FHA Primes Lenders for LRS, Defect Taxonomy; System to Go Live in 2Q

The FHA is nearing full implementation of a new loan review system (LRS) for managing FHA’s Title II single-family quality-control processes. No specific implementation date has been set but it could be sometime in the second quarter, the agency said. The LRS builds on FHA’s efforts to align the documentation of loan-review results. In addition, it incorporates the Single-Family Housing Loan Quality Assessment Methodology or defect taxonomy. The FHA said the new system would not be used to manage any aspect of the agency’s standard loan origination or endorsement processes. Rather, it would be used to review of test cases submitted by lenders seeking unconditional direct-endorsement authority. It would be used as well for various post-endorsement reviews of forward single-family loans. After the ...

February 24, 2017 - Inside Mortgage Trends

Housing Crisis Boxed in Some Job Seekers

Distress in the housing market has an impact on the location and types of jobs individuals are willing to take, according to research by the National Bureau of Economic Research. During the most recent recession, distressed borrowers tended to apply for fewer jobs that required relocation and looked for lower-level positions, according to an NBER working paper by Jennifer Brown of the Sauder School of Business at the University of British Columbia and David Matsa of ...

February 24, 2017 - Inside MBS & ABS

Lenders Record Partial Win over RFC; NY Court Rules on Statute of Limitations; SIFMA Files Brief

A Minnesota state court has rendered a judgment that could substantially limit the amount of damages Residential Funding Co. and its successor-in-interest, the ResCap Liquidating Trust, could recover if it were ever to prevail on its claims in any given lawsuit against correspondent lenders, according to industry attorneys. On Feb. 1, the District Court of Hennepin County held that RFC and ResCap would not be able to pursue loan-by-loan damages associated with a repurchase claim and, thus, could not use a repurchase price “formula” to establish damages, said Philip Stein, a partner with Bilzin Sumberg Baena Price & Axelrod, in an analysis. The decision favored...

February 23, 2017 - Inside Mortgage Finance

Hensarling Says Delinquency Surge Justifies Suspension of FHA Premium Cut; Consultant Says Spike May be a Fluke

A spike in FHA delinquency rates in the fourth quarter of 2016 has prompted a top House Republican leader to laud the Trump administration for its decision to suspend a 25 basis point cut in FHA mortgage insurance premiums, though some say the increase might be a fluke. Last month, an analysis by Inside FHA/VA Lending, an affiliated newsletter, revealed that delinquency rates were up across the board for FHA loans backing Ginnie Mae mortgage-backed securities. The share of current FHA loans as of the end of the fourth quarter slipped from 94.2 percent to 93.2 percent, while the share of loans 90 days or more past due rose to 0.82 percent, the highest it’s been since June 2014. The figures are based on loan count and are not seasonally adjusted. The Mortgage Bankers Association two weeks ago reported...

February 16, 2017 - Inside Mortgage Finance

Delinquencies Increase on a Quarterly Basis At the End of 2016, Foreclosures Decline

Mortgage delinquencies in the fourth quarter of 2016 hit their highest level of the year, erasing declines from the previous quarter, according to the Inside Mortgage Finance Large Servicer Delinquency Index. The foreclosure rate continued to decline, hitting levels last seen in 2007. Among the servicers tracked by the index, the total mortgage delinquency rate was 5.05 percent as of the end of the fourth quarter. The rate was at 5.54 percent at the end of 2015 and declined each quarter until the most recent period. Each delinquency bucket increased...[Includes one data table]

February 13, 2017 - Inside the CFPB

Consumers Still Complaining About Mortgage Servicing Practices

Mortgage borrowers still have plenty to complain to the CFPB about, especially on the mortgage servicing front, the latest monthly consumer complaint report from the bureau suggests. “The most common issues identified by consumers are problems when they are unable to pay (loan modification, collection, foreclosure),” which were cited by 49 percent, according to the CFPB, followed by issues making payments (loan servicing, payments, escrow accounts), identified by 33 percent. Other homeowners brought up problems having to do with applying for a loan (application, originator, mortgage broker), which was noted by 9 percent, followed by signing the agreement (settlement process and costs), which was highlighted by 5 percent, and receiving a credit offer (credit decision, underwriting [With Two Data Charts]....


With rates higher this year, there has been talk of lenders liberalizing their underwriting standards in an effort to increase volume and make up for lower refis.

Do you think your shop will loosen standards over the coming three months?

Yes, but not by much.


Yes, by a lot.


Yes and, heck, we may even do non-QM lending.


No, not at all.


No and we may even tighten credit.