Mortgage servicers should already be in the process of preparing to implement Fannie Mae and Freddie Mac's soon-to-be unveiled servicing requirements as the two GSEs work to roll out new rules in the coming weeks.

Two California members of the House, one Republican, one Democrat, have introduced a bill to extend indefinitely high-cost loan limits for Fannie Mae, Freddie Mac and the FHA due to expire this fall.

A federal appeals court last week upheld a lower court ruling that shareholders of Freddie Mac cannot sue the former directors and officers of the GSE for losses following the government takeover of Freddie by the Federal Housing Finance Agency.

The two sibling GSEs experienced a wildly divergent earnings period during the first quarter of 2011 as Freddie Mac posted its first quarterly gain in two years while big sister Fannie Mae announced losses that drove it even deeper into the red. [Includes one data chart.]

Correspondent lending has taken a chunk of market share away from the broker channel, and smaller banks are jumping at the opportunity to become correspondent lenders to fill the spaces that too-big-to-fail lenders have overlooked or ignored. NexBank is among those trying to fill the gap. The North Texas state savings bank has announced a new wholesale correspondent channel aimed at offering mortgage brokers a chance to serve as mortgage bankers to their customers. NexBank is also looking to partner with community banks that have the balance sheet or warehouse line to fund loans but do not have the ability or desire to underwrite the loans. As a partner...

Peter Federico, Freddie Mac's executive vice president - Investments and Capital Markets, has tendered his resignation after more than two decades with the GSE.

U.S. banks are generally more liquid than Basel III liquidity standards would suggest thanks in large part to the treatment of banks' large portfolios of GSE-related securities, according to Fitch Ratings.

A large investment portfolio intended to generate added earnings is inconsistent with the purposes of the Federal Home Loan Bank System and is a "misuse" of the system's preferential access to capital markets, the head of the FHLB’s regulator told Bank directors this week. [Includes one data chart.]

A bipartisan bill unveiled this week by two House members would overhaul the federal mortgage finance system to ensure private sector capital for homebuyers and capital requirements to protect taxpayers - without Fannie Mae or Freddie Mac.

Look for refinance activity to continue to decline throughout the year, experts warn, but only a small percentage of those homeowners who do take a seat at the closing table will be "cash-out" borrowers. Freddie Mac reported last week that during the first quarter of 2011, only 25 percent of those who refinanced their existing mortgage loans pulled cash out of their home. Among refi loans, the average cash-out share - which Freddie defines as when the loan balance is increased by at least 5 percent - over the past 25 years was 62 percent. Even more surprising, Freddie noted that a record 21 percent of refi borrowers actually reduced their principal balance by...