The Department of Housing and Urban Development has made long-awaited increases for claimable attorney fees and extended the foreclosure timeframes in many jurisdictions to help mortgage servicers perform better. The agency sets limits on the attorney fees servicers can claim on an FHA foreclosure and prescribes the length of time for doing due diligence. The last time HUD updated its guidance on fees and “reasonable diligence timeframe” for prosecuting a foreclosure on an FHA-insured loan was in 2005. However, changes in state foreclosure requirements in recent years have made it difficult for FHA servicers to ...

The Department of Housing and Urban Development has updated the timelines and methods servicers must follow for communicating with borrowers in default. Mortgagee Letter 2013-39 also addresses policies for engaging borrowers early in their delinquencies, specialized collection techniques for early-payment defaults or re-default, and FHA’s expectation for servicers to have written processes and procedures to follow for every stage of delinquency up to collection. Communicating early with borrowers who are late in their mortgage payments is essential in ensuring that delinquency is properly addressed, the agency said. HUD’s latest guidance provides a “collection-communication timeline,” which is a series of sequential steps a servicer can follow in dealing with a delinquent borrower. These steps would help the servicer assess a borrower’s circumstances, intentions and financial condition as well as determine an appropriate response.

Ginnie Mae issuers reported a 14.0 percent drop in mortgage-backed securities issuances in the third quarter from the previous quarter as refinance activity declined further and home-purchase lending slowed during the period, according to an Inside FHA Lending analysis of Ginnie Mae data. Despite the quarter-over-quarter drop, Ginnie production rose 11.2 percent in the first nine months of 2013. Volume over this period totaled $313.8 million, of which 60.3 percent were FHA loans, 33.9 percent were VA, and 5.2 percent were rural housing loans. Ginnie MBS issuance dropped gradually ... [2 charts]

Recapitalization of RMIC Will Pave the Way for a Return to MI Market. Old Republic International (ORI) is planning to recapitalize its mortgage guaranty subsidiary, RMIC Companies, Inc., which could resume underwriting in early 2014. Old Republic plans to contribute up to $50 million of new capital and raise additional funds, which would allow RMIC and its subsidiaries to fully support existing policies, pay off deferred claim obligations, exit state supervision, and resume underwriting new business early next year. The cash infusion would require ...

The focus on purchase mortgages became urgent as interest rates started to increase in May, settling for the moment about 100 basis points higher than they were in April, reducing demand for refinances.

At Sept. 30, Freedom Mortgage serviced $28.69 billion of home mortgages, an impressive 75 percent jump from the same period a year earlier.

Impac Mortgage originated $576.2 million of home loans in 3Q, a 26 percent sequential decline.

During the third quarter of 2013, for the first time since the middle of 2008, private mortgage insurers edged past the government-insurance programs to become the biggest source of primary MI coverage in the market, according to a new ranking and analysis by Inside Mortgage Finance. Private MIs provided primary coverage on $59.03 billion of newly originated mortgages during the third quarter. That was down 3.2 percent from the second quarter, but the FHA and VA programs posted even bigger declines of 17.5 percent and 10.6 percent, respectively. That gave the private MI sector a 39.4 percent share of new primary coverage, its highest level since the second quarter of 2008. The last time private MIs did...[Includes three data charts]

Fairholme owns $3.5 billion (face value) of GSE junior preferred stock. After company chief Bruce Berkowitz sent his tender offer to FHFA and then went on CNBC to discuss the plan, you can bet that the price of GSE preferred probably increased a bit.

Will the banks that bought “junior” preferred stock in Fannie Mae and Freddie Mac prior to the housing bust ever be made whole? Will investors that purchased the preferred after that time eventually be rewarded for the gamble they took on such a highly speculative investment? Those two questions look a lot more interesting these days thanks to continued strong earnings from the two government-sponsored enterprises. According to filings with the Securities and Exchange Commission, Fannie and Freddie say...