Iowa Attorney General Tom Miller, who’s heading up the 50-state settlement talks with the nation’s top mortgage servicers over industry foreclosure practices, is defending the decision to proceed without the direct participation of New York Attorney General Eric Schneiderman. In a letter to the New York delegation to the U.S. House of Representatives, Miller rejected the assertion that the state AGs had removed Schneiderman from the negotiation table. “New York State Attorney General Eric Schneiderman voluntarily walked away from the negotiation table in June,” Miller said.

Overlooked in the often rancorous partisan sniping during last week’s hearing to consider the nomination of Richard Cordray as the first director of the Consumer Financial Protection Bureau were some remarks the candidate made that suggest he is interested in reducing the regulatory compliance burden facing mortgage lending institutions. “I ... am convinced that the bureau will find many opportunities to streamline regulations and disclosures,” Cordray told members of the Senate Banking, Housing and Urban Affairs Committee last week. “Our ‘Know Before You Owe’ project is working to combine the mortgage disclosure forms required under two distinct but overlapping statutes to make the costs, risks and responsibilities of a home loan clearer to consumers and at the same time to reduce paperwork burdens for lenders – which is a true win-win.

FHA lending continued its downward trend as total originations fell 9.5 percent in July from the previous month and a whopping 41.2 percent on a year-to-year basis, according to Inside FHA Lending’s analysis of the latest data. The market saw production drop to $14.8 billion in July from $16.3 billion on a monthly basis and from $25.1 billion the same period last year. Fixed-rate mortgages comprised the bulk of originations at 93.7 percent, while purchase mortgages accounted for 78.5 percent of loans endorsed for FHA insurance for the month of July. In addition, 79.3 percent of FHA-insured loans were originated ... {includes one data chart]

The reverse mortgage arena experienced another shake-up as SunTrust Bank, citing poor volume, quite the business even as J.G. Wentworth, the largest purchaser of future payment products, announced its entry into the market. Atlanta-based SunTrust stopped accepting new reverse mortgage applications as of Sept. 1, although it is continuing to process applications already in the pipeline. A statement from the bank indicated that low production volume was the reason for management’s decision to leave the reverse mortgage business and to focus resources instead on mortgage origination and servicing. The market also lost ...

The Department of Housing and Urban Development recently provided guidance to housing counselors and lenders regarding changes made to the layout and administration of HUD’s Certificate of Home Equity Conversion Mortgage Counseling. HUD’s Certificate of HECM Counseling, identified as Form HUD 92902, is provided by housing counselor as proof that a homeowner interested in pursuing a HECM product has received information about the implications of and alternatives to a reverse mortgage. The HECM counselor must adhere to all of FHA’s guidelines regarding information that must be provided to the HECM borrower. With respect to the form’s layout under Mortgagee Letter 2011-31, HUD has inserted ...

The Department of Housing and Urban Development is seeking comment on a proposed rule that would expand FHA-insured lending in rural areas. Published in the Aug. 26 Federal Register, the proposed rule would allow direct lenders in the Farm Credit System to participate in the FHA mortgage insurance programs as approved mortgagees or lenders. Although participation in the mortgage insurance programs is voluntary, Farm Credit System financial institutions must comply with FHA approval requirements. The comment period ends Oct. 25. Recent difficulties in mortgage finance markets have reduced the availability of housing credit in rural areas, where the FHA currently does very limited business. Consequently, HUD proposes ...

Recent changes to Ginnie Mae’s repurchase policy are getting positive reviews from analysts. Announced on Aug. 26, the revised loan buyout policy will make it easier for servicers and issuers to buy delinquent home loans out of Ginnie Mae pools without having to wait 90 days for the loan to become eligible for repurchase. Before the change, pool repurchases were allowed only if a borrower missed three consecutive mortgage payments. Under the revised policy, issuers can buy delinquent loans out of the pool while the borrower is making partial payments under an FHA or VA trial payment plan as a prerequisite for a permanent modification. On the surface, the revised policy would appear ...

A coalition of industry and advocacy groups is flexing its collective muscle as it prepares to push Senate legislation extending the current maximum mortgage loan limits. The group, comprised of 14 financial and real estate trade and advocacy associations, are lining up behind S. 1508, the Homeownership Affordability Act of 2011, which would extend the temporary high-cost area loan limit through the end of 2013. Introduced by Sens. Robert Menendez, D-NJ, and Johnny Isakson, R-GA, the bill complements a similar bipartisan effort by Reps. John Campbell, R-CA, and Gary Ackerman, D-NY, in the House Financial Services Committee to keep ...

Losses on re-performing FHA/VA mortgage pools are expected to rise as servicers cut back on the claims they submit to the Department of Housing and Urban Development and pass on to mortgage securitization trusts instead, according to a recent analysis by Moody’s Investors Service. With FHA experiencing increasing losses in its portfolio, HUD is scrutinizing claims more vigorously for servicing or underwriting defects, which may serve as a basis for denying claims on re-performing FHA/VA pools. Servicers are also required to bring the property to an acceptable conveyance condition. Furthermore, HUD imposes very strict timeline guidelines that FHA servicers must follow. Given the recent servicing irregularities and staffing constraints due to rising defaults, servicers may not always ...

The Department of Housing and Urban Development is pondering its next move after discussing with mortgage industry representatives their concerns about extending the current forbearance period for unemployed homeowners to a maximum of 12 months. HUD and FHA officials met recently with the Mortgage Bankers Association and several small mortgage servicers, which took issue with FHA’s recently revised forbearance policy. HUD declined to discuss the outcome of the meeting, saying it was more about understanding the industry’s concerns and discussing solutions. “No decision has been made as to whether we can or will make any changes, but we are looking into the issues they have raised,” said a HUD spokesman. On July 7, the FHA announced ...