The volume of refinance originations may have dropped significantly during the first quarter of 2011, but refi transactions continued to account for a historically high share of new business, according to a new ranking and analysis by Inside Mortgage Finance. Lenders originated an estimated $235 billion in refinance loans during the first three months of this year, which represented 72.3 percent of all single-family mortgage production. That was one of the highest quarterly refi market shares ever, ranking behind the fourth quarter of 2010 and the first two quarters of 2009. Refi production volume was down 40.1 percent from the end of 2010, however... [Includes two data charts]

Congressional Republicans have at least temporarily prevented the Obama administration from appointing Elizabeth Warren as the first director of the Consumer Financial Protection Bureau. There was speculation that the White House would use the recess scheduled for the Senate this week to appoint Warren to lead the CFPB, an agency she helped design. Last week, 20 Senate Republicans wrote House Speaker John Boehner, R-OH, urging him not to pass the Senate’s adjournment resolution, keeping the Senate at least nominally in session and preventing Pres. Obama from making any recess appointments. In 2007, Democrats in the Senate used...

There would be fewer FHA-insured mortgage loans originated in more than 20 percent of U.S. counties if the current FHA loan limits were allowed to revert to limits set by the Housing and Eco-nomic Recovery Act, the Department of Housing and Urban Development warned. Evaluating FHA-insured mortgage loans originated in 2010 and 2011 to date that had loan sizes exceeding the HERA limits, HUD found that approximately $14.2 billion, or about 6 percent, would not have been endorsed had HERA restrictions been in place at the time. While 669 counties would likely...

The Office of the Inspector General of the Federal Housing Finance Agency says it has numerous audits and investigations in the works as part of its plan to evaluate and, if necessary, correct the performance of the FHFA and the government-sponsored enterprises it regulates.Last week, the FHFA-OIG released two separate but related reports – OIG’s Inaugural Semiannual Report to Congress and its Audit and Evaluation Plan. The former mainly outlined the new agency’s operations from its activation in October 2010 through March of this year, while the latter explained...

Bank of America and Saxon Mortgage Services last week agreed to separate settlements with the Department of Justice over allegations the firms wrongfully foreclosed on active-duty members of the U.S. military in violation of the Servicemembers Civil Relief Act of 2003.The federal government wants the settlements to function as a compliance model for other servicers addressing foreclosure-related issues involving borrowers actively serving in the military.BAC Home Loans Servicing LP, the former Countrywide Home Loans Servicing LP, agreed to pay $20 million to resolve...

Federal regulators are hearing it from all corners as industry groups are joining step with consumer advocates and lawmakers on Capitol Hill urging the agencies to write a less restrictive definition of qualified residential mortgages. A letter from a bipartisan group of U.S. senators said the proposed risk-retention rule drafted by federal regulators earlier this year goes beyond the intent of Congress in prescribing a narrow defini-tion of QRM loans which could be securitized without forcing the issuer to retain a 5 percent interest in the transaction. “These restrictions unduly narrow...

The Department of Justice has stepped up its fair lending enforcement initiatives and more cases are anticipated in the future, but with them comes a dilemma, according to industry sources. The DOJ currently has five lawsuits pending against lenders and several investigations, a DOJ insider said. The official said cases involve redlining, wholesale pricing, product steering and retail pricing. Wholesale issues and broker fee cases are likely to continue popping up, the source said. “The other big development for 2011 is going to be the...

The legacy of toxic subprime and Alt A MBS from Countrywide Financial continued to spread last week, with a California appeals court deciding to allow a class action involving a number of pension funds and other institutional investors against the lender to proceed. The plaintiffs allege that Countrywide and a number of its subsidiaries, officers and U.S. investment banks violated the Securities Act of 1933 by making materially false and misleading statements in over 450 prospectus supplements relating to the issuance of more than $300 billion in subprime and Alt A securities. Specifically, plaintiffs allege the defendants misrepresented the quality of...

Savings institutions reported a total of $200.9 billion of residential MBS in their retained portfolios at the end of the first quarter of 2011, up marginally from the end of the previous year. But the heart of the industry – firms regulated by the Office of Thrift Supervision – actually posted a small decline in their MBS holdings during the period. The OTS itself is being phased out as a separate federal regulator, although the savings association charter will continue under the supervision of a dedicated unit in the Office of the Comptroller of the Currency. OTS-regulated thrifts held $157.6 billion of MBS in their portfolios at the end of... [Includes two data charts]

A trio of housing trade associations went to bat for the role of government-sponsored enterprises this week, but not necessarily for Fannie Mae and Freddie Mac, arguing that GSEs, as well as the government itself has a role in the reform of the housing finance system. During testimony this week before the Senate Banking, Housing and Urban Affairs Committee, representatives from the National Association of Realtors, the National Association of Home Builders and the National Multi Housing Council/National Apartment Association warned lawmakers that the current efforts to wind down Fannie and Freddie must not disrupt the already fragile housing and...