SunTrust Banks late this week said it has entered into a $968 million mortgage settlement with the GSEs and the Department of Housing and Urban Development to resolve buyback claims and losses suffered by the FHA. Overall, Fannie Mae will receive $323 million in cash, Freddie Mac $65 million. The payment to Fannie releases the nation’s ninth largest home funder – according to figures compiled by Inside Mortgage Finance – from “certain existing and future repurchase obligations.”

Expect more GSE repurchase settlements in the near future, say industry insiders, following last week’s announcement by Freddie Mac that it scored a trifecta of buyback settlements with three of the country’s biggest financial institutions. Wells Fargo, Citigroup and SunTrust Mortgage will pay a combined $1.3 billion to the GSE and in exchange Freddie will – with some limitations and exclusions – release the companies from certain existing and future loan repurchase obligations for specific populations of loans.

As the partial government shutdown and debt-ceiling crisis completed its second week, the sense of relative urgency for housing finance reform that lawmakers from both parties expressed just a month ago at the five-year anniversary of Fannie Mae’s and Freddie Mac’s conservatorship had taken a back seat to larger, partisan hostilities, say industry observers.In September, Democrat and Republican leadership of the Senate Banking, Housing and Urban Affairs Committee set a goal of finishing committee-level consideration of GSE reform by the end of 2013.

The Federal Housing Finance Agency failed to clarify the goals and objectives for its real-estate owned pilot program, as well as for the future of the GSEs’ REO disposition activities as the program evolved, according to a recent audit by FHFA’s Office of Inspector General. The FHFA-OIG report criticizes both the Finance Agency and Fannie Mae for shortfalls in their planning and oversight of the REO pilot program.

The Federal Housing Finance Agency has issued guidance to Fannie Mae and Freddie Mac on how to effectively pursue and collect deficiencies from borrowers who may have the ability to repay their mortgages. In a recent advisory bulletin, the FHFA identified the factors the GSEs should consider before attempting to recover a deficiency balance.

The mix of single-family mortgages securitized by Fannie Mae and Freddie Mac during the third quarter of 2013 continued to shift toward purchase mortgages, according to a new Inside Mortgage Trends analysis of the government-sponsored enterprise market. Purchase mortgages accounted for 36.7 percent of Fannie/Freddie business during the third quarter, up from 23.9 percent during the previous period. It was the highest purchase-mortgage share of GSE business since the market collapse ... [Includes two data charts]

New prepayment data provide further evidence that rising mortgage interest rates are shriveling the refinance market, but firming home prices are fertilizing a potential surge in home-equity lending. “We have seen prepayments decline by more than 30 percent since May, when mortgage interest rates began climbing approximately 100 basis points to where we are today,” said Herb Blecher, senior vice president at Lender Processing Services. As a result, the percentage of borrowers currently in loans with ...

Over the past two months, some of the nation’s largest residential lenders – Bank of America, Citigroup and Wells Fargo – have sent layoff notices to 7,200 full-timers, according to figures compiled by Inside Mortgage Trends. The layoffs break down as follows: 4,100 at Wells Fargo, 2,100 at BofA and 1,000 at Citigroup. JPMorgan Chase, the nation’s number two ranked lender, has been trimming staff as well. In total, roughly 1,200 mortgage workers were let go at Chase locations in Texas and California ...

An analysis of modified mortgage loans shows Ocwen Financial’s modifications were the best in the field as the servicer focused not only on volume but on quality as well. Performed by Moody’s Investors Service, the report attributed Ocwen’s excellent results to its ability to take that extra step to prevent the loan from going to foreclosure and help distressed homeowners keep their homes. Moody’s focused on mortgages that were seriously delinquent at the height of the mortgage crisis ...

The Appraisal Foundation suggested this week that “alternative valuation products” likely will not comply with professional appraisal standards in most cases. If an AVP requires the same development and reporting requirements as an appraisal, the Appraisal Foundation said in a white paper, why would the industry create the AVP in the first place? The foundation noted that the Appraisal Standards Board does not deem any alternative valuation product or form as compliant with the industry’s ...