The ACLU is calling for changes to federal anti-discrimination statutes to deter secondary mortgage market participants from engaging in business practices that might have a discriminatory impact on certain protected classes of borrowers. In a recent analysis of mortgage foreclosures, the ACLU said the origination and securitization of subprime and other high-risk mortgage products have hurt minority families and caused the loss of 3.5 million homes to foreclosure. The ACLU believes...

Complicating the post-election process of regulatory implementation is the expectation that a number of top officials at key agencies are likely to move on during President Obama’s second term. For the mortgage finance industry, perhaps the most notable potential departure among administration officials is that of Treasury Secretary Tim Geithner. Geithner has dropped hints more than once this past year that he wants to move on. Treasury officials did not respond to requests for confirmation of that as of press time. Other key officials on the industry’s departure watch list include...

After winning multiple bids to acquire mortgage servicing rights and subservicing on nonprime loans and agency mortgages, nonbank servicers were outbid last week for the latest major agency MSR acquisition. Industry analysts suggest that the somewhat unexpected competition from banks could hinder planned expansion by Ocwen Financial, Nationstar Mortgage and Walter Investment Management. JPMorgan Chase Bank is set to acquire $70.0 billion in agency MSRs from MetLife. “The acquisition of this ...

If implemented as proposed, Basel III capital requirements would force major changes for bank lenders and servicers, according to industry participants. Originations of non-agency mortgages would remain limited, mortgage holdings would be sold and borrowers would face additional costs. Rules to implement Basel III were proposed in June by the Federal Deposit Insurance Corp., the Federal Reserve and the Office of the Comptroller of the Currency. Comments were due in October and some industry ...

Wells Fargo has asked a federal district court in Washington, DC, to declare the U.S. government in violation of the terms of the landmark $25 billion mortgage servicing fraud settlement earlier this year that resolved federal and state claims against the bank and four other major servicers for alleged servicing malpractices. In a complaint filed last week, Wells Fargo also asked the D.C. court to order the Department of Justice to halt all legal actions seeking to impose additional liability on Wells Fargo based on a ...

There is substantial risk that the FHA may end up with a negative net worth, which would require congressional appropriations for the mortgage insurance fund and passage of legislation reforming the FHA, said a former top official at the Department of Housing and Urban Development. In remarks this week at the Urban Institute, John Weicher, former assistant secretary for housing and FHA commissioner in 2001-2005, said it is very unlikely in this weak economic recovery to see ...

The volume of loans guaranteed by the Department of Veterans Affairs rose 4.0 percent in the third quarter of 2012, reflecting an upward trend that the agency attributes to strong underwriting. A production increased to $33.3 billion from $32.0 billion in the second quarter and $28.3 billion in the first quarter. The agency reported $93.6 billion in total originations over the nine-month period, with refinancing accounting for 51.8 percent of guaranteed loans. “VA has had the best performing loans in the industry for quite some time, with the ... [1 chart]

Banks that say they were less likely to approve an application for an FHA-insured mortgage cited a higher risk of putback of delinquent mortgages by the FHA as an important reason for the change, according to the Federal Reserve’s latest survey of bank lending practices. Responding to a special question on FHA lending, 14 of the respondents (36.8 percent) ranked putbacks as a “very important” issue, nine banks (23.7 percent) thought it was the “most important” while an equal number said it was “somewhat important.” Nine of the 14 respondents were ...

A second-term Obama administration is expected to continue support for lowering maximum loan-to-value ratios and upward premium pricing to strengthen the FHA’s Mutual Mortgage Insurance Fund, according to the Mortgage Bankers Association. While President Obama has indicated an interest in reducing the FHA’s presence in the mortgage market for a larger private sector role in mortgage finance, he is inclined to proceed cautiously so as not to disrupt consumer access to affordable FHA financing, said MBA President/CEO David Stevens. Stevens observed that Obama has been ...

Hurricane Sandy homeowners with FHA and VA mortgages have been given temporary relief, including a 90-day suspension on foreclosures and as much as 100 percent financing for victims who have lost their homes. The Department of Housing and Urban Development and the Department of Veterans Affairs have announced federal disaster assistance to hard-hit areas in Connecticut, New York and New Jersey. Both agencies announced a three-month freeze on foreclosures in the affected areas as well as forbearance on foreclosures of FHA and VA home loans. The VA advised its lenders that careful counseling should ...