The Securities and Exchange Commission has adopted a modified policy that will require defendants in settlement agreements to admit to wrongdoing if they have already pled guilty in parallel criminal cases. “Following a review by senior enforcement staff that began this spring and separate discussions with the commissioners over the last several months, last week we modified our settlement language for cases involving criminal convictions where a defendant has admitted violations of the criminal law,” said SEC Enforcement Director Robert Khuzami.The new policy does not require admissions...

Freddie Mac had a difficult time keeping up with Fannie Mae and Ginnie Mae in mortgage pass-through production last year, but the government-sponsored enterprise continued to out-produce the other agencies in structured mortgage securitizations. Freddie issued a total of $154.7 billion in single-family real estate mortgage investment conduits in 2011, which represented 41.0 percent of the agency REMIC market. While the overall market was down 17.8 percent from the previous year, Freddie increased its REMIC issuance by 24.7 percent. Fannie managed a modest 1.6 percent increase from the...

Redwood Trust is getting ready to issue its first jumbo MBS of 2012 backed by a more diverse pool of prime mortgages than the company’s previous transaction. Fitch Ratings said it plans to give AAAsf ratings to the senior bonds in Sequoia Mortgage Trust 2012-1, which will enjoy 8.25 percent credit enhancement from subordinate classes. That’s a stiffer credit enhancement level than on Redwood’s two jumbo deals from last year, which had 7.40 percent and 7.50 percent support levels at issuance. Two factors appeared to play the biggest part in the higher credit support levels: more diverse collateral and more...

Agency single-family MBS issuance ended 2011 with a bang as the three agencies jostled for market share, a new Inside MBS & ABS analysis reveals. Ginnie Mae and Freddie Mac ended the year with nearly identical total issuance, with Freddie seeing a slightly larger decline from 2010 levels. Fannie Mae, however, recorded a much smaller drop in total production last year, boosting its share of the agency market. Freddie could not keep pace with Fannie’s surging MBS issuance volume during the fourth quarter. In December, Freddie accounted for just 22.7 percent of combined production by the two...

The N.Y. Supreme Court Appellate Division overturned a ruling that dismissed a foreclosure case because attorneys representing the lender failed to meet a deadline for filing a conflict-of-interest document. Judge Arthur Schack dismissed the case brought by U.S. Bank because its attorneys, the now infamous Steven J. Baum law firm, submitted a conflict-of-interest filing 123 days after it was due. The case involved Kelvy Guichardo, a defendant who defaulted on his mortgage. Schack was concerned that there might be a conflict of interest for Steven J. Baum and ordered the law firm to submit an...

Refinance activity has represented more than half of home loan originations every year since 2006, and housing sales have been in a slump for the past five years. But individual mortgage lenders continue to carve out their own production strategies, including in some cases a devotion to the smaller purchase-mortgage sector. A new Inside Mortgage Finance analysis of loans originated under the four major agency mortgage programs through the first nine months of 2011 shows that many of the top overall producers beefed up their market share by aggressively originating...(Includes one data chart)

The home-equity loan market declined further during the third quarter of 2011 as depository institutions reined in new production and their existing portfolios – in most cases – continued to wither. According to the Federal Reserve, the outstanding supply of home-equity loans – both closed-end second mortgages and lines of credit – fell to $887.5 billion as of the end of the third quarter. That was down 1.9 percent from the midway point in 2011 and off 21.5 percent from the HEL market’s all-time high of $1.131 trillion reached back in 2007. Most home-equity loans are held in portfolio by..(Includes two data charts)

Mortgage industry groups are urging the U.S. Supreme Court to pay close attention to the wording of the Fair Housing Act – specifically phrasing that’s not in the 1968 law – in deciding whether fair lending charges can be brought on the basis of disparate impact. In an amicus brief filed in the case of Magner v. Gallagher, mortgage trade groups said the Fair Housing Act “requires proof of intentional discrimination and does not envision a violation based on disparate impact.” The brief was filed by K&L Gates on behalf of the Independent Community Bankers of America, the Consumer Mortgage...

Fed Governor Sarah Bloom Raskin late last week stumped for creating an effective enforcement system to deal with shortcomings in the mortgage servicing industry that have come to light since the foreclosure crisis, as state officials pressed to expand a potential settlement over past abuses. “The law is not a scarecrow where the birds of prey can seek refuge and perch to plan their next attack,” Raskin said in a speech to a group of attorneys. The Fed governor said it’s important for servicers to have transparent, enforceable and sensible rules, adding that deferring to “standard industry...

It started last week with an unsolicited white paper outlining “a framework for thinking about certain issues and tradeoffs that policymakers might consider” and blossomed into a coordinated assault by the Federal Reserve on the housing slump that won’t go away. Having purchased over $1 trillion in mortgage securities in an effort to drive mortgage interest rates to all-time lows, the Fed appears to be using its speechmaking and paper-writing powers to try to get the rest of Washington moving on housing. In addition to the policy paper, Fed officials in the past week have made three speeches on...