The CFPB this week launched a public inquiry into student loan servicing practices that create repayment challenges, hurdles for distressed borrowers and economic incentives that may affect the quality of service. “As a growing share of student loan borrowers reach out to their servicers for help, the problems they encounter bear an uncanny resemblance to the situation where struggling homeowners reached out to their mortgage servicers before, during and after the financial crisis,” CFPB Director Richard Cordray said during a field hearing in Milwaukee on Thursday. “Having seen the improper and unnecessary foreclosures experienced by many homeowners, the CFPB is concerned that inadequate servicing is also contributing to America’s growing student loan default problem.” Currently, about 8 million Americans are...
Performance of subprime mortgages continues to improve as the volume of loans outstanding slowly declines. Some $320.0 billion in subprime mortgages were outstanding as of the end of the first quarter of 2015, according to estimates by Inside Nonconforming Markets. Volume was down 4.2 percent from the previous quarter and 16.0 percent from the first quarter of 2014. The total past-due rate for subprime mortgages fell to 17.60 percent ... [Includes one data chart]
Ocwen Financial filed its annual report for 2014 this week and noted that its auditors decided against requiring a “going concern” qualification for the nonbank. “We believe the filing of our annual report, without a qualification as to our ability to operate as a going concern, is additional evidence that our strategy to strengthen our compliance management system, strengthen the service we provide to our customers and improve our financial stability is working and that confidence ...
Price reduction and improving economic factors helped push FHA volume up in the first quarter of 2015, according to an Inside FHA/VA Lending analysis of agency data. Production of forward single-family mortgages insured by FHA increased by 12.3 percent in the first quarter to $39.5 billion from $35.2 billion in the prior quarter, powered by a sharp uptick in refinances. FHA’s total refi business jumped from $2.29 billion in endorsements in February, a month of record snowstorms in the Northeast, to $8.15 billion in March. Total FHA forward-mortgage business rose by 83.8 percent from February, data showed. FHA streamline refis rose a whopping 144.1 percent quarter-over-quarter while conventional-to-FHA refis jumped 29.2 percent over the same period. Falling purchase loan volume, which was the reason for the overall decline in FHA originations last year, spilled over into ... [2 charts]
The FHA overall delinquency rate for single-family mortgages fell by 63 basis points to 9.10 percent on a seasonally adjusted basis in the first quarter of 2015 from the previous quarter, while VA loans recorded the only increase across all loan types over the same period, according to the Mortgage Bankers Association. Overall, mortgage delinquencies and foreclosures continued to fall in the first quarter and are now at their lowest levels since 2007, according to the MBA’s quarterly delinquency-rate survey. On a seasonally adjusted basis, the overall delinquency rate fell 14 bps to 5.54 percent from the fourth quarter of 2014, and 57 bps from one year ago, the MBA said. The serious delinquency rate – the share of mortgages that are 90 days or more past due or in foreclosure – likewise fell 28 basis points to 4.24 percent from the previous quarter and down ...
Making mortgage payments is the most common type of mortgage complaint active servicemembers, veterans or their dependents report to the Consumer Financial Protection Bureau. A recent CFPB report on the top complaints received from military members and their families show that 24 percent were mortgage-related, second to debt collection, which accounted for the highest percentage of complaints received, 39 percent. An estimated 53 percent of servicemember complaints involved mortgage servicing related to loan modifications, collections and foreclosures. The report did not identify any specific loan, although it covered both conventional and government-backed mortgages. Complaints against servicers were mostly about failure to remove or amend derogatory credit reports accrued by servicemembers during the trial period, even though the servicemembers have successfully ...
The Department of Agriculture’s Rural Housing Service has issued a final rule creating a certified loan-application packaging process for the agency single-family loan guaranteed housing program.Published in the April 29 Federal Register, the rule also establishes standards for packagers of loan applications, who are independent from RHS but play a key role in providing Section 502 rural home loan programs to potential homeowners. The final rule will take effect on July 28, 2015. Specifically, the rule addresses the weaknesses in RHS’ loan-application process and integrates the lessons learned from a loan-packaging pilot launched in 2010. The packager gathers and submits the information needed for RHS to determine whether a loan applicant is eligible for ...
An internal audit of the FHA/Home Affordable Modification Program’s partial-claim option uncovered flaws that cost taxpayers millions of dollars in ineligible claims. According to a recent report by the Department of Housing and Urban Development’s Office of the Inspector General, HUD’s claim-payment controls were inadequate. As a result, the agency paid more than $22 million in unsupported claims and $103,925 in ineligible claims, the report concluded. Auditors said HUD did not design and implement strong safeguards to detect and prevent improper claims. Because of the flaws, the system allowed payment of more than one claim with a modification or FHA-HAMP option in a 24-month period, the report said. In addition, auditors found duplicate claims, partial claims in excess of 30 percent of the unpaid principal balance at initial default, and non-HAMP partial claims after HUD ...
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