Mortgage repurchase requests by Fannie Mae and Freddie Mac show no signs of slowing down, and the two government-sponsored enterprises appear poised to pick up the pace with buyback de-mands targeting mid-tier financial institutions, warned Fitch Ratings. Fitch issued a note last week in which the rating agency cited signs of a potential shift in focus by the GSEs from the big banks to the smaller regional banks as a target of opportunity for increased representation and warranty claims.“Recent announcements by PNC, SunTrust and First Horizon that they intend to boost future GSE ...

For more than a decade, Countrywide Financial’s “VIP Program” approved nearly 18,000 sweet-heart mortgages to congressmen, policymakers and officials at the government-sponsored enterprises in an effort to curry favor in Washington and strengthen its business relationship with Fannie Mae, ac-cording to a newly released congressional inquiry. Last week’s 136-page report from House Oversight and Government Reform Committee Chair-man Darrell Issa, R-CA, completed a three-year investigation by the committee of Countrywide’s “Friends of Angelo” program, which ran from January ...

Consumers who take out mortgages that are considered high cost currently receive special pro-tections from fees and risky loan terms. The Consumer Financial Protection Bureau this week came out with a proposed rule that would expand what is considered a high]cost mortgage and provide more protections to consumers who take out those loans. Loans that meet high-cost triggers under the Home Ownership and Equity Protection Act are subject to special disclosure requirements and restrictions on loan terms, and borrowers in high-cost mortgages have enhanced remedies ...

As Inside Regulatory Strategies was going to press this week, the Consumer Financial Protection Bureau was releasing a detailed proposed rule to integrate the mortgage disclosures consumers are entitled to under the Real Estate Settlement Procedures Act and the Truth in Lending Act. The proposal is accompanied by new “loan estimate” and “closing disclosure” forms to present the costs and risks of the loan in clearer terms. “The forms benefit consumers by using plain language and a format that will help them understand their loans,” the CFPB said...

Three jurisdictions in California are raising a lot of industry hackles over a plan that could lead to the use of eminent domain to seize currently performing underwater mortgages and force a restructuring of their terms. It’s a plan “more like Grand Theft Mortgage than a silver bullet” for the region’s housing woes, according to former Fannie Mae executive Edward Pinto. At issue is a resolution adopted last week by California’s San Bernardino county and the cities of Ontario and Fontana in which the jurisdictions entered into a joint powers agreement. Under the resolution...

House Oversight and Government Reform Committee Chairman Darrell Issa, R-CA, released a report last week that took another look at Countrywide Financial’s “Friends of Angelo” and “VIP Program,” concluding that Countrywide used the latter to lobby policymakers as well as to strengthen its relationship with Fannie Mae. According to the report, Countrywide reached an exclusive agreement with Fannie in 1999 to sell the government-sponsored enterprise billions of dollars in mortgages at a discounted rate. “The agreement led to a period of codependence and mutual growth,” the report noted...

Federal banking regulators and private-sector mortgage servicers have gradually stepped up their efforts to reach out to eligible borrowers facing foreclosure and have taken steps to improve their communication materials. However, they have not undertaken certain “best practices” such as conducting readability tests or using focus groups that might have maximized their potential outreach, the Government Accountability Office said in a new report. “Staff at the Board of Governors of the Federal Reserve System said that this was, in part, a trade off to expedite the remediation...

Rep. Scott Garrett, R-NJ, chairman of the House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises, successfully attached an amendment to H.R. 5972, the Department of Housing and Urban Development Appropriations Act, 2013. Garrett’s amendment would gut the disparate impact rule proposed by HUD last September by prohibiting the agency from using any of the agency’s funding to “promulgate, issue, establish, implement, administer, finalize, or enforce” the rule. The congressman’s amendment has strong support from the mortgage...

California is about to become the first state to enact into law a large portion of the national mortgage servicing settlement that state and federal government officials negotiated this year with the nation’s top five banks and apply it to all lenders. The state legislature passed the Homeowner Bill of Rights last week (AB 278/SB 900). The Democrat-controlled state Assembly approved the bill on a 53-25 vote, with the Senate endorsing the measure 25-13. The legislation will force large lenders to provide a single point of contact, eliminate dual tracking and impose significant civil...

In response to the Federal Housing Finance Agency’s request for comments on its recent strate-gic plan, the American Securitization Forum put out a white paper this week spelling out the mechanics and potential benefits of a blueprint to transition to a single agency security that could be issued by Fannie Mae and Freddie Mac. “Implemented correctly, a single agency security could benefit all participants in the mortgage market, including borrowers, originators, investors and the taxpayer,” said ASF Executive Director Tom Deutsch. Current trading markets for Fannie MBS and Freddie PCs are...