Since the repurchase and indemnification phenomenon is unlikely to disappear anytime soon, many correspondent lenders, credit unions and other recipients of a repurchase/indemnification demand want to know how best to respond in order to mitigate potential damages. During a recent webinar sponsored by American Mortgage Law Group, AMLG Senior Managing Member James Brody said there are many different factors to consider. “One of the things that really helps in getting any resolution is...

RBS Securities has agreed to pay $120 million to the state of Connecticut to resolve an investigation into its underwriting of residential MBS shortly before the 2008 collapse of the financial markets. CT Attorney General George Jepsen and Department of Banking Commissioner Jorge Perez announced the agreement, which, they said, is the largest single settlement in Connecticut’s history. It also ends a four-year state investigation into RBS’s securities underwriting and due diligence practices. At issue were...

Fannie Mae and Freddie Mac saw a robust 29.7 percent jump in single-family mortgage business during the third quarter, with most of the gain coming from the purchase-mortgage side of the business. And more purchase-mortgage business usually means a bigger share for correspondent lenders. Correspondent originations accounted...[Includes two data tables]

Given that the mortgage servicing industry seems far removed from where it was when the housing crisis peaked, what will become of default servicing in the years to come? For one thing, a certain amount of delinquency will always exist in the housing market, according to a new white paper from the Five Star Institute, which drew together research, insight and commentary from a host of industry resources and experts. “For all the loans that are out there, there will always be...

PHH Corp. this week scored a key legal victory in its battle with the Consumer Financial Protection Bureau over captive reinsurance and the Real Estate Settlement Procedures Act. But despite this good news, there are still clouds over the nonbank. The “worst” of the recent spate of bad news for the company surrounds the early October disclosure that Merrill Lynch is breaking all ties to PHH when it comes to private-label originations and servicing. The effective date for the end of the contract is...

Private mortgage insurers are quietly gaining ground on their government-insured rivals in the critical home-purchase market, according to a new Inside Mortgage Trends analysis of agency mortgage-backed securities data. Fannie Mae and Freddie Mac securitized $61.47 billion of purchase mortgages with private MI coverage during the third quarter, a gain of 33.4 percent from the previous period. At the same time, Ginnie Mae securitized $79.91 billion of FHA and VA purchase mortgages, up 19.3 percent from the second quarter. The private MI share of agency purchase loans rose...[Includes two data tables]

Bank pricing strategies are more about responding to new product regulations, fee income and capital and liquidity standards rather than to their consumers’ view of value, according to a new Deloitte report on retail-bank pricing. The report, which attempts to make the case for value-based pricing, contends that bank pricing tactics focus primarily on costs and risks rather than on how consumers perceive and receive value. It’s...

Trends in the agency mortgage-backed securities market suggest that private mortgage insurers may have gained some market share from government MI programs during the third quarter of 2016, according to a new Inside Mortgage Finance analysis. Fannie Mae and Freddie Mac securitized a total of $75.89 billion of insured single-family mortgages during the third quarter, an increase of 29.5 percent from the previous period. That was a tad below the 29.7 percent increase in overall MBS production by the two government-sponsored enterprises, but it kept the private MI share at 26.8 percent for the third quarter. Meanwhile, the booming Ginnie Mae market showed...[Includes two data tables]

The traditional interpretation of Section 8 of the Real Estate Settlement Procedures Act that the mortgage industry has relied on for decades was vindicated this week when a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit sided with most of the arguments advanced by PHH Mortgage in its dispute with the Consumer Financial Protection Bureau. The crux of the dispute has been the bureau’s assertion that PHH violated RESPA by steering business to private mortgage insurers that purchased reinsurance from a captive insurer owned by PHH. Most large lenders and all private MIs engaged in these arrangements prior to the housing market collapse. Early on in the case, an administrative judge agreed...

Not only are commercial banks continuing to lose residential production market share, but it appears they are paying their retail loan officers less than nonbanks – a lot less. According to more than a dozen interviews conducted with executives and LOs at originating firms with different charters, some nonbanks are allowing for compensation plans that pay the originator upwards of 200 basis points. At banks, the best LO comp plan is 100 bps, Inside Mortgage Finance found. One bank mortgage manager, who spoke under the condition his name not be used, said...