Any policies employed by federal regulators that restrict mortgage lending in localities that use eminent domain to seize underwater mortgages would violate anti-discrimination laws, according to a group of House Democrats. In letters to two government agencies, a group of 10 Democrat lawmakers led by Minnesota Rep. Keith Ellison said the Federal Housing Finance Agency should continue to provide access to government-sponsored enterprise MBS guaranties and the Department of Housing and Urban Development should allow FHA mortgage insurance in such communities. “To deny such access would be illegal under the Fair Housing Act and would violate credit discrimination laws,” according to a draft of the letters obtained by Inside MBS & ABS. An FHFA spokesman confirmed...
At a Senate Banking Committee hearing, Sen. Robert Menendez, D-NJ, criticized FHFA Acting Director Ed DeMarco for his plan to reduce both the conforming loan limit and the high-cost limit.
The regulatory regime currently contemplated in government-sponsored enterprise reform legislation in the Senate doesn’t go far enough, according to officials at the Federal Housing Finance Agency and others. At a hearing this week by the Senate Committee on Banking, Housing and Urban Affairs, Alfred Pollard, general counsel at the FHFA, testified that the regulatory functions included in GSE reform legislation from Sens. Bob Corker, R-TN, and Mark Warner, D-VA, should be enhanced. “Making regulatory authority clear and explicit, including where appropriate the ability to establish prudential standards, set capital requirements and take enforcement actions, would enhance...
In just a matter of days, JPMorgan Chase agreed to two separate settlements totaling $17.5 billion to resolve federal and state civil claims as well as representation and warranty and servicing claims involving residential MBS. On Nov. 19, the Department of Justice, along with other federal and state agencies, announced a $13 billion settlement with JPMorgan, which acknowledged making misrepresentations about billions of dollars in MBS sold to investors prior to Jan. 1, 2009. The settlement is said to be the largest combination of damages and civil fines for a single entity in U.S. history. Most of the damage was inflicted...
Nancy Handal, managing director of insurance conglomerate MetLife, oversees a $70 billion fixed-income portfolio and a $6 billion “high-yield” residential MBS opportunity fund – but has bought into just one jumbo MBS deal over the past few years. And she’s not shy about the reasons why: it’s all about disclosures. Handal is not happy about what non-agency issuers disclose and in particular she’s dismayed that MBS investors are essentially frozen out of the due-diligence process. Speaking at a housing forum sponsored by the Urban Institute and CoreLogic this week, the MetLife executive expressed...
Retail mortgage-production units accounted for 63.0 percent of new originations during the third quarter of 2013, according to a new analysis and ranking by Inside Mortgage Finance. That was up slightly from a 62.8 percent retail share of new production during the second quarter, and it represented one of the highest levels of retail-channel dominance ever. The share of retail originations has soared over the past few years as many major lenders have scaled back their broker and correspondent operations. But all three production channels showed...[Includes four data charts]
Industry stakeholders called upon lawmakers to delay the implementation of hefty increases in flood-insurance premiums as a result of the Biggert-Waters Flood Insurance Act of 2012. However, support among lawmakers for delaying the mandated changes appear to be weak. In a hearing this week in the House Financial Services Subcommittee on Housing and Insurance, Republicans and Democrats apparently were unswayed by community advocates, academics, the National Association of Realtors and the National Association of Home Builders regarding the financial pain being inflicted by the Biggert-Waters Act on homeowners. The sudden, dramatic increase in flood insurance premiums – some by as much as 1,000 percent – are leaving...
With refinance volume falling and minimum net-worth requirements heading north, advisors in the mergers-and-acquisitions market say undercapitalized firms should sell now, while they still can. Larry Charbonneau, a principal of Charbonneau & Associates of Texas, said he is currently working on four deals but noted that, “There a lot of shops out there with less than $5 million in capital that need to do something but haven’t realized it yet.” Although Fannie Mae and Freddie Mac have net-worth minimums in the $3 million range, there is...
Republicans on Capitol Hill might be laying the groundwork for legislation that could scale back the application of the disparate impact theory of legal liability in mortgage lending. Currently, there is no active legislation to that effect pending in the U.S. House of Representatives or the Senate, and industry lobbyists said there is no such interest underfoot. But just the fact that the House Financial Services Subcommittee on Oversight and Investigations held a hearing this week on disparate impact in general had some Democrat supporters of the theory a bit anxious. “My hope is...
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