In the case of Brisbin v. Aurora Loan Services LLC, the U.S. Court of Appeals for the Eighth Circuit has ruled that a lender’s oral promise to postpone foreclosure is unenforceable; that is, that such a promise is a credit agreement that has to be in writing if it is to be enforceable. Borrower Alison Brisbin filed this lawsuit in Minnesota state court against Aurora Loan Services LLC, Mortgage Electronic Registration Systems Inc. and Freddie Mac, seeking legal and equitable relief from the foreclosure and sale of her home. She alleged three legal theories for invalidation of the...
The California Assembly and Senate unanimously passed identical six-bill packages known as the California Homeowner Bill of Rights to simplify the state Attorney General’s ability to initiate and conduct statewide grand jury mortgage fraud investigations. The legislation has been designed to guarantee:Basic standards of fairness in the mortgage process, including an end to dual-track foreclosures.Transparency in the mortgage process, including a single point of contact for homeowners....
Conference of State Bank Supervisors. Last week, the Conference of State Bank Supervisors and the Nationwide Mortgage Licensing System & Registry issued for the first time two quarterly publications that together present a comprehensive overview of all individuals, mortgage companies and depository institutions that make residential mortgage loans in the United States. The Nationwide View of State-Licensed Mortgage Entities collects data on companies, branches and mortgage loan originators who are state-licensed or state-registered through the NMLS. The document presents information about...
Office of Mortgage Settlement Oversight. BDO Consulting Tapped. Joseph Smith, monitor of the national mortgage settlement, has selected BDO Consulting, a division of BDO USA, LLP, as his primary professional firm. BDO will join Smith and his team for a period of three and a half years as they oversee the implementation of the settlement involving 49 states, the U.S. government and five of the nationfs largest banks. gAs I entered the process of engaging the primary professional firm, I knew it would be critical to find the right balance of independence and capacity, Smith said...
A total of 221 rulemaking requirement deadlines mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act have passed, through the first five months of the year, according to the latest Dodd-Frank progress report prepared by the Davis Polk law firm. gThis is 55.5 percent of the 398 total rulemaking requirements, and 78.9 percent of the 280 rulemaking requirements with specified deadlines,h according to the report. Further, of the 221 deadlines that have passed, 148 (67.0 percent) have been missed and 73 (33.0 percent) have been met with finalized...
Agency MBS issuance rebounded from a sluggish April to yield $125.4 billion in new production last month, according to a new Inside MBS & ABS ranking and analysis. May issuance was up 14.8 percent from the previous month as 2012 continued to run well ahead of the pace set last year. A total of $619.4 billion of agency single-family MBS were issued during the first five months of the year, an increase of 26.9 percent over the same period in 2011. Production last month was a solid rebound from April’s sluggish $109.2 billion in total agency MBS issuance, but it was well short of...(Includes two data charts)
Non-agency mortgage-backed security investors are hoping to influence the implementation of the recent $25 billion foreclosure settlement and ward off similar agreements in the future. They raised concerns this week at a hearing before the House Financial Services Committee’s Subcommittee on Capital Markets and Government Sponsored Enterprises. “As it stands, it will damage residential MBS markets further,” said Vincent Fiorillo, a trading/portfolio manager at Doubleline Capital, on behalf of the Association of Mortgage Investors. “By adding yet another risk premium to government intervention, it will further...
The Obama administration is on the same page as Fannie Mae and Freddie Mac’s regulator in its desire to shift some of the mortgage credit exposure the government-sponsored enterprises hold to private investors. But exactly how to develop some sort of GSE risk-sharing program continues to bedevil policymakers, a Treasury Department official noted last week. Michael Stegman, a special advisor to Treasury Secretary Timothy Geithner, explained in a speech to real estate professionals that the Treasury is “actively engaged in helping to make this [GSE risk sharing] initiative work” but the...
A federal judge in Los Angeles has dismissed a number of claims in an American International Group lawsuit against Bank of America over mortgage securities issued by Countrywide Financial, although AIG has promised to continue its legal efforts to recoup more than $10 billion in MBS losses. U.S. District Judge Mariana Pfaelzer of the Central District of California in a new ruling dismissed AIG’s federal securities-law claims because they were filed too late – more than three years after the MBS were first sold. AIG filed suit against BofA as Countrywide’s owner and Merrill Lynch in New York state court...
The settlement baked into the Residential Capital bankruptcy agreement is facing new challenges, including one from Warren Buffet’s Berkshire Hathaway and another from unsecured creditors. When ResCap announced its bankruptcy last month, it did so with a plan to sell its mortgage origination platform and servicing rights to Nationstar Mortgage, a division of Fortress Investment Group, for $4 billion and its portfolio loans to its parent company Ally Financial. Part of the deal is a release of legal liability for Ally, which will pass along some of its lingering obligations – like follow through on the...
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