The streamlined short sale programs announced last summer by Fannie Mae and Freddie Mac received an extra boost from mortgage insurers as the programs took effect Nov 1.The GSEs this week announced signed delegation agreements with nine private mortgage insurance companies to allow Fannie and Freddie servicers to complete short sales and deeds-in-lieu without seeking approval from the MI.

The government’s civil mortgage fraud lawsuit filed last week against Bank of America and Countrywide Financial for allegedly scheming to defraud Fannie Mae and Freddie Mac could have serious adverse consequences for the industry going forward, according to an industry attorney. Filed by the U.S. Attorney for the Southern District of New York, the government contends that since the U.S. Treasury has been forced to bail out the two GSEs, losses suffered by Fannie and Freddie can be recovered under the False Claims Act – a federal law that provides for treble damages and penalties. Laurence Platt, financial services practice leader at K&L Gates, warned participants during an Inside Mortgage Finance webinar that the government’s lawsuit against BofA and others like it sure to follow, threatens to turn “every low-level rep and warranty” with Fannie or Freddie into a federal case.

The Federal Housing Finance Agency can and should impose greater transparency standards on Fannie Mae and Freddie Mac given the two GSEs’ linchpin role in the mortgage market today, according to the head of the Mortgage Bankers Association. MBA President and CEO David Stevens at the association’s annual convention in Chicago two weeks ago called for the Finance Agency – as GSE conservator – to require Fannie and Freddie to comply with public notice and comment rules before the GSEs impose new rules on the real estate finance industry. Taxpayer-supported Fannie and Freddie, along with Ginnie Mae – a wholly owned government corporation within the Department of Housing and Urban Development – currently backstop some 90 percent of all new mortgages.

The Federal Housing Finance Agency recently issued an updated strategic plan in which the FHFA outlines the next phase of conservatorship for the GSEs, Fannie Mae and Freddie Mac. The FHFA’s plan establishes “restrictions and expectations” for the GSEs, which have been under government conservatorship since September 2008, but the agency does not manage the day-to-day operations of the two companies. Just like the draft document first submitted to Congress earlier this year, the FHFA’s updated Strategic Plan: Fiscal Years 2013-2017 sets four broad goals for the Finance Agency: safe and sound housing GSEs; stability, liquidity, and access in housing finance; preserve and conserve the GSEs’ assets; and prepare for the future of housing finance in the U.S.

Fannie Mae and Freddie Mac this week directed servicers to inform homeowners reeling from the damage inflicted by Hurricane Sandy that they may be eligible for a temporary reprieve on their mortgage payments. The GSEs’ announcement reiterated their policy on mortgage relief to borrowers located in jurisdictions that the president has declared to be major disaster areas.

With most precincts now having reported third-quarter earnings, the outcome is clear: mortgage banking was hugely profitable during the third quarter of 2012. A new Inside Mortgage Trends analysis of earnings reports from 25 public companies reveals record mortgage banking income of $9.903 billion during the third quarter. That was a huge 19.2 percent increase over the hefty $8.311 billion these companies earned from their mortgage banking activities during the second quarter ... [Includes one data chart]

An entity affiliated with Ocwen Financial and Walter Investment Management separately initiated financing schemes around the time the two companies joined to bid on the mortgage assets of the bankrupt Residential Capital. Ocwen and Walter last week won a ResCap auction with a joint bid of $3.0 billion, including $540.0 million from Walter. The companies noted that ResCap was servicing $374 billion in unpaid principal balance as of the end of the first quarter of 2012, including a significant amount of ...

Mortgage brokers have made a comeback and a number of new buyers have stepped into the correspondent market – with the common theme of a stronger focus on loan quality. Wholesale lenders have become more selective, said Matthew Young, a senior vice president at Genworth Mortgage Insurance, during a panel session at the Mortgage Bankers Association annual convention in Chicago last week. Buyer attitudes in the correspondent market have been shaped by the risk of mortgage buybacks, which have led to ...

It looks like many banks may have been too distracted with loan modifications, foreclosures and regulatory compliance issues over the last few years to notice a potentially vast untapped well of profit in their own back yards. A new consumer mortgage study finds that banks are passing by an opportunity to increase their mortgage business by a whopping 79 percent with their existing customer base. “Thirty-nine percent of survey respondents have their mortgage with their primary bank, the bank with which they do ...

Regulations arising from the Dodd-Frank Act and Basel III capital standards would result in fewer mortgage loans made, tighter lending standards, reduced home sales, fewer jobs and slower economic growth, warned a new study from the American Action Forum, a policy think tank in Washington, DC. In particular, the AAF said that taken as a whole, the finalized rules on qualified mortgages and qualified residential mortgages,as well as Basel provisions requiring banks to hold more capital for certain risk-weighted ...