A federal judge in Los Angeles last week denied a motion by Bank of America’s Countrywide Financial unit to dismiss securities fraud claims by the Federal Housing Finance Agency on behalf of Fannie Mae and Freddie Mac for toxic MBS purchased by the government-sponsored enterprises.The FHFA’s complaint alleges that Fannie and Freddie purchased approximately $26.6 billion in residential MBS that Countrywide sold from Aug. 30, 2005, to Jan. 23, 2008. The agency alleges negligent misrepresentations and fraud related to the offerings of Countrywide MBS.
FHFA's plan for a single MBS platform that would be managed by a new government entity separate from Fannie Mae and Freddie Mac does not mean the agency is contemplating consolidating the two GSEs at this time.
The Mortgage Bankers Association and other industry trade groups are backing bipartisan legislation that would modify the definition of points and fees in the 'ability-to-repay' and QM rules.
The Obama administration is employing multiple defenses to try to stave off an expected legal determination that the president’s controversial recess appointment of Richard Cordray as director of the Consumer Financial Protection Bureau is unconstitutional.Last week, the National Labor Relations Board announced it will not seek en banc rehearing in Noel Canning v. NLRB, in which the U.S. Court of Appeals for the District of Columbia Circuit af-firmed that the Jan. 4, 2012, recess appointments of three members to the board were unconstitutional.
The forlorn home-equity lending market remained at record lows in new production despite growing signs of improvement in the housing market, a new Inside Mortgage Finance analysis and ranking reveals.Mortgage lenders originated a record low of just $44.0 billion in home-equity loans last year, down 12.0 percent from 2011. Although total home-equity lending was down, credit unions reported a 5.4 percent increase in their annual originations compared to 2011. (Includes two data charts)
Last week, nine Democrat state attorneys general, led by New York AG Eric Schneiderman and Massachusetts’ Martha Coakley, called for the Obama administration to nominate a permanent re-placement for Federal Housing Finance Agency Acting Director Edward DeMarco.Under DeMarco’s leadership, the AGs say, Fannie Mae and Freddie Mac remain “an obstacle to progress” primarily by the FHFA’s refusal to allow the two government-sponsored enterprises to offer principal reduction assistance to troubled borrowers.
Look for Fannie Mae and Freddie Mac to continue to increase their guaranty fees, but the current level of g-fees is approaching “striking distance” of the threshold expected in a competitive private market, the head of the Federal Housing Finance Agency told lawmakers this week.Testifying before the House Financial Services Committee, FHFA Acting Director Edward De-Marco said last year’s two 10 basis point g-fee increases raised the average fee to around 50 bps, double where they were when the GSEs were put in conservatorship in September 2008.
Last summer, the Office of the Comptroller of the Currency issued an advisory concerning warehouse lines of credit that was all but ignored by most players in the market. That is, until now. In a research note, Keefe, Bruyette & Woods said the “new” OCC rules could force Texas Capi-tal Bank to increase the risk weighting of its warehouse lines to 100 percent, from its current designa-tion of 37 percent.
Members of the House and Senate on both sides of the aisle are working on legislation to reform the mortgage finance system, but partisan differences suggest that the most likely accomplishment may be steps aimed at not making the difficult task any harder.In the Senate, a handful of members from both parties recently introduced the “Jumpstart GSE Reform Act,” which would prevent guaranty fees collected by the government-sponsored enterprises from being used to offset other government spending.
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