President Obama has named Carol Galante as acting FHA commissioner and assistant secretary for housing at the Department of Housing and Urban Development. Galante was most recently HUD deputy assistant secretary for multifamily housing. She will replace Robert Ryan, who most recently also served as Acting FHA Commissioner and Assistant Housing Secretary. Ryan will become senior advisor to HUD Secretary Shaun Donovan on housing finance matters. In his new expanded role, Ryan will serve as HUD’s leaderon the interagency housing deputies’ team. He will develop, among other things, the department’s view regarding a long-term plan for...

The Obama administration is requiring FHA to participate in special program that extends forbearance periods for unemployed homeowners from four to 12 months to help them avoid foreclosure while seeking re-employment. The current unemployment forbearance programs have mandatory periods that are inadequate for most unemployed borrowers, said Department of Housing and Urban Development Secretary Shaun Donovan. Servicers participating in the Making Home Affordable Program may also be directed to extend the minimum forbearance period to 12 months wherever possible under regulatory or investor guidelines, Donovan added. Specifically...

Overlooking investor overlays in mortgage loan underwriting can be quite costly and could expose lenders to regulatory risk and liability. iServe Residential Lending, a retail mortgage banker in San Diego, believes it has found the ultimate solution to its underwriting problems, especially with regards to investor overlays, including FHA, VA, Fannie Mae, Freddie Mac and Ginnie Mae. iServe, which originates conventional, government and jumbo loans, recently implemented PriceMyLoan, an automated underwriting and loan pricing tool from Insight Lending Solutions, the same folks who created TOTAL Scorecard for FHA. “PriceMyLoan is the only system that...

A new Inside Mortgage Finance analysis reveals that the proposed qualified residential mortgage standard drafted earlier this year by federal regulators would affect individual mortgage originators in dramatically different ways. As the regulators acknowledged in their proposed rule, a significant share of Fannie Mae and Freddie Mac loans originated through 2009 would not meet new standards for loan-to-value ratios, borrower credit history, debt-to-income ratio and other factors. Most loans being sold to the government-sponsored enterprises under today’s pristine underwriting and pricing policies also would fail to meet the... [Includes one data chart]

The Department of Housing and Urban Development is working on a proposed regulation that seeks to harmonize existing standards for determining when a housing practice with a discriminatory impact violates the Fair Housing Act. The proposed rule would cover the liability standards in instances in which a racially neutral housing practice has a discriminatory effect. The disparate impact theory has been used in fair housing cases to allege discriminatory activity when the terms of a business policy are neutral toward protected classes but the policy is shown to have greater impact on minorities or other protected groups. There has been debate over...

High-risk mortgages securitized by Fannie Mae and Freddie Mac continued to drag down earnings for the government-sponsored enterprises in the first quarter of 2011, forcing the two GSEs to go deeper into debt to the federal government. Fannie and Freddie lost a combined $13.0 billion on their mortgage-backed security guarantee programs during the first quarter, a significant deterioration from the $6.6 billion the GSEs lost during the previous quarter, according to the Federal Housing Finance Agency’s latest conservatorship report. Since the beginning of 2008 through the first quarter of 2011, Fannie and Freddie have burned through...

The nation’s top mortgage servicers had to submit remedial plans for their foreclosure practices this week as part of their consent agreements with federal banking regulators, after having been granted an extension from the original submission timeline. Some servicers told Inside Mortgage Finance their plans are confidential and couldn’t be released to the public. An official at the Office of the Comptroller of the Currency said there are no plans for the agency to release those plans or to summarize their contents. The affected servicers are...

A new bipartisan bill introduced last week that would replace the government-sponsored enterprises Fannie Mae and Freddie Mac with a single, government-owned entity designed to issue and guarantee mortgage-backed securities demonstrates the lack of political consensus – within the Republican party and Congress in general – about how to deal with the GSE problem. The new bill, H.R. 2413, the Secondary Market Facility for Residential Mortgages Act of 2011, would effectively merge Fannie and Freddie into a single government-backed entity that would issue and guarantee MBS. The MBS would have an explicit government guarantee paid for by...

The Obama administration and Fannie Mae are requiring mortgage servicers to participate in special foreclosure prevention programs that extend forbearance periods for unemployed homeowners from 12 to 24 months to help them avoid foreclosure while seeking re-employment. The current unemployment forbearance programs have mandatory periods that are inadequate for most unemployed borrowers, said Department of Housing and Urban Development Secretary Shaun Donovan. The FHA will extend the forbearance period for unemployed homeowners to 12 months. Servicers participating in the Making Home Affordable Program may also be directed to extend the minimum forbearance period to...

Credit unions posted a significant increase in mortgage production volume during the first quarter of 2011, compared to the same period last year, but the industry has not yet broken through to a broader role in the market. Federally insured credit unions originated $21.5 billion in home mortgages during the first three months of the year, up 16.6 percent from a year ago, according to data from the National Credit Union Administration. But that was down 35.7 percent from the $33.5 billion that credit unions originated in the fourth quarter of 2010. The credit union share of the total mortgage market held steady at 6.6 percent of total... [Includes two data charts]