Mortgage lenders appear divided on whether a joint venture with home builders at this time would be profitable or just a shot in the dark. With home building and purchase-mortgage lending clearly in a slump, joint ventures are probably more important now than ever because the mortgage process has become more complicated and difficult for the consumer, according to a homebuilding industry executive. Bank of America, however, may be cold on joint ventures right now. Saddled with the misfortunes of Countrywide, BofA strategically ended a joint venture recently with ...

Fannie Mae and Freddie Mac issued $154.95 billion in single-family mortgage-backed securities during the second quarter of 2011, a 40.6 percent drop from the first three months of the year.The recent April-June cycle represented the second straight quarterly decline in business volume since the fourth quarter 2010 surge when the two GSEs issued $331.5 billion in MBS.

People get discouraged from taking mortgage loan modifications that are in their best interest by countless paperwork steps and little support from servicers, according to a Harvard University behavioral economist who says he has a solution. Piyush Tantia, the executive director of ideas42, a nonprofit behavioral economics research and development lab at Harvard, has been experimenting with how people respond to foreclosure. Behavioral economics blends psychology and economics to analyze and predict decisions based on how people actually behave. Tantia found that people often did not ...

Four separate research studies found that mortgage counseling dramatically helps homeowners who receive it, especially financially challenged owners, according to the Homeownership Preservation Foundation. The studies show that counseling increases the likelihood that a homeowner will be granted a loan modification by 200 percent. Borrowers who accept counseling also receive better terms on loan modifications compared to those who don’t get counseling, with an average $110 lower monthly payment and an interest rate that’s ...

It would be “wholly inappropriate” for the Treasury Department and the Federal Housing Finance Agency to permit Fannie Mae and Freddie Mac to pursue a potential role in a new yet-to-be-launched $2 billion bond program, according to the top Republican members of the House Financial Services Committee.In an effort to shut down thoughts of potential expansion of the two government-sponsored enterprises into a new line of business, Committee Chairman Spencer Bachus, R-AL, Vice Chairman Jeb Hensarling, R-TX, and four of the committee’s subcommittee chairman dispatched a letter last week to Treasury Secretary Tim Geithner and FHFA Acting Director Edward DeMarco to express their “concern.”

Another bipartisan bill to overhaul the federal mortgage finance system introduced by two House members this week would eliminate but effectively merge Fannie Mae and Freddie Mac, replacing the two GSEs with a “secondary market facility” that would issue and guarantee mortgage-backed securities.The bill, H.R. 2413, the Secondary Market Facility for Residential Mortgages Act of 2011, would create a single entity, owned by the federal government, that would issue MBS. The MBS would have an explicit government guarantee paid for by a guarantee fee set by the Federal Housing Finance Agency.

Fannie Mae late last week notified its lenders that the GSE has modified its requirements for reporting notifications of mortgage insurance revisions, mortgage insurer-initiated cancellations and claim denials.

Freddie Mac late last week issued its own set of servicing guidelines in keeping with its mandate from the Federal Housing Finance Agency that mirror the guidelines that its fellow GSE Fannie Mae released in June.The FHFA’s Servicing Alignment Initiative, announced in late April, requires Fannie and Freddie to align their servicing requirements in four key areas: borrower contact, delinquency management practices, loan modifications and foreclosure timelines.

Freddie Nears Proposed TBW SettlementFreddie Mac and defunct mortgage servicer Taylor, Bean & Whitaker Mortgage Corp. have entered into a proposed settlement that would grant the GSE an unsecured claim of $1.022 billion that mostly represents past and future repurchase claims.The proposed settlement, filed with the Bankruptcy Court for the Middle District of Florida two weeks ago, would result in a distribution between $40 million to $45 million, which is less than the outstanding repurchase requests, according to Freddie Mac’s filing with the Securities and Exchange Commission.

The former chairman and owner of Taylor, Bean & Whitaker was slammed with a 30 year prison sentence and ordered to forfeit approximately $38.5 million for his key role in orchestrating a $2.9 billion fraud scheme that led to the failure of TBW and Colonial bank and counted Freddie Mac as among its victims.