Home mortgage production volume increased by 20.4 percent during the third quarter of 2011 as record-low mortgage interest rates sparked a new wave of refinancing activity. An estimated $325.0 billion in new residential mortgages were originated during the third quarter, according to a new Inside Mortgage Finance ranking and analysis. While that was up solidly from the previous three-month period, it still ranked as the second lowest quarter since the mortgage market collapsed at the end of 2008. Through the nine-month mark in 2011, total production for the year was still down 16.7 percent from...(Includes two data charts)

The Supreme Court of the United States will settle a multi-district circuit court conflict that will likely determine the ability of the mortgage lending industry to determine on its own what to charge borrowers at the point of origination. In deciding earlier this month to accept Freeman v. Quicken Loans Inc., the high court will confront the question of whether a plaintiff must demonstrate an unearned fee for a real estate settlement service was divided between two or more persons in order to establish that a violation of Section 8(b) of the Real Estate Settlement Procedures Act occurred.

The Consumer Financial Protection Bureau last week began testing a revised design of its integrated consumer mortgage disclosure prototypes with consumers and industry in the Albuquerque, NM, area, the agency revealed. The latest pair, dubbed “Pinyon” and “Yucca,” represent a fixed‐rate and an adjustable‐rate mortgage, respectively. Both forms include sections on loan terms, projected payments, closing costs, calculating settlement costs, calculating cash to close, comparisons, other considerations and verify receipt. But the Yucca version adds an adjustable interest rate table.

Several large banks and mortgage companies are accused of cheating military veterans and taxpayers out of millions of dollars by hiding illegal fees in VA refinance transactions and of deliberately misleading the government to obtain guarantees for the refinanced loans. Three law firms – Butler Wooten & Fryhofer and Wilbanks & Bridges in Atlanta and Phillips & Cohen in Washington, D.C. – have teamed up to pursue the “qui tam” or whistleblower lawsuit on behalf of two mortgage brokers and the U.S. government. The brokers, Victor Bibby and Brian Donnelly, brought the lawsuit under the False Claims Act, a federal law that goes back to the Civil War when it was used to ...

The House of Representatives has passed legislation that would give surviving spouses of fully disabled veterans access to VA home loans. The bill, H.R. 120, the Disabled Veterans’ Surviving Spouses Home Loans Act, is part of H.R. 2433, the Veterans Opportunity to Work Act, which the House overwhelmingly approved on Oct. 12 by a vote of 418 to 6. H.R. 2433 contains six pieces of veteran legislation designed to address veteran unemployment. Introduced by Rep. Virginia Foxx, R-NC, H.R. 120 aims to allay concerns of veterans with permanent and total disabilities about where their surviving spouses would live should the veteran die of causes unrelated to their military service. Under current law, a surviving spouse may qualify for a VA home loan only if the service member’s death is determined to be related to service disabilities. Otherwise, the surviving spouse qualifies only for ...

The Department of Housing and Urban Development is a step closer to leveling the playing field for FHA lenders but there is more to be done, according to a recent analysis by K&L Gates. Recent changes announced by HUD are a good start to setting right the unintended adverse effects of last year’s changes to FHA’s lender-approval requirements, but HUD needs to do more to implement these changes fully, concludes the analysis. Authors Krista Cooley, Holly Spencer Bunting and Kathryn Baugher, all attorneys with K&L Gates, said future pronouncements from HUD should provide additional guidance on how to address the inequities between third-party originators and FHA-approved lenders with regards to ...

The Department of Housing and Urban Development has suspended a former president of Lend America from doing any business with the agency following his admission that he engaged in a mortgage fraud scheme against the FHA in 2009. Michael Primeau, the former executive, had pled guilty to charges he directed employees of Lend America, a former FHA-approved lender, to divert mortgage funds intended to pay off borrowers’ first mortgages at refinance closings in order to pay company-operating expenses. Two years ago, HUD and the U.S. Attorney for the Eastern District of New York filed a civil complaint against Ideal Mortgage Bankers, doing business as Lend America, in federal district court. The complaint sought ...

The Senate voted this week to reinstate the higher conforming loan limit that expired at the end of September, heeding calls by the real estate and mortgage industries. On a vote of 60-38, lawmakers passed an amendment to the FY2012 funding bill, S. 1596, for the Department of Housing and Urban Development, which, among other things, would raise the maximum loan amount that can be guaranteed by FHA, Fannie Mae and Freddie Mac. Introduced by Sen. Robert Menendez, D-NJ, the amendment restores the 125 percent median home price formula used to calculate the temporary higher loan limits in effect prior to Oct. 1, which was up to $729,750 in certain high-cost areas of the country and lower in other jurisdictions. After Oct. 1, the new loan limit calculation was ...

The departure of MetLife Bank, a division of insurer MetLife Inc., from the mortgage business will leave a gap in the FHA market that should not be hard to fill. The bank recently announced its intention to sell its mortgage business due to uncertainty in the marketplace and the rising cost of compliance in an excessively burdensome regulatory environment. It is getting too difficult to compete and be profitable under these conditions, the bank said in a statement. MetLife Bank’s mortgage-related woes reflected on its FHA origination volume and market share, both of which have been shrinking over the last couple of quarters. MetLife ranked fourth among ...