Recent court rulings in Washington, DC, and Nevada allowed foreclosures brought by homeowner associations over unpaid dues to extinguish mortgage liens, increasing the risk of loss for investors in non-agency MBS and single-family rental securitizations, according to Moody’s Investors Service. Although both jurisdictions are relatively small in the grand scheme of things, other courts could adopt the same interpretations, the rating service said. Nevada has already seen some 1,000 similar cases, and more homeowner and condo associations are like to bring similar lawsuits. In Nevada, the court decided...
The Federal Housing Finance Agency this week unveiled a policy alteration that would potentially allow a foreclosed homeowner to purchase a home – including one he/she lost due to arrears – from the real estate owned inventory of Fannie Mae or Freddie Mac. The change will permit Fannie and Freddie to sell existing REO properties to any qualified purchaser at the property’s fair-market value, as determined by the GSE, according to the FHFA.
With just over four weeks left in 2014, investment bankers expect a flurry of bulk deals to hit the market. But whether they close or not is a different matter. “There are definitely several deals – both large and small – that are being considered,” said Tom Piercy, managing member of Interactive Mortgage Advisors. “We are working on four or five deals totaling $10 billion.” Piercy said he wasn’t at liberty to provide details about the transactions since some have yet to be finalized. In two recently announced auctions, IMA is selling a $3.2 billion package of Fannie Mae/Freddie Mac mortgage servicing rights and a $1.6 billion pool.The brokerage firm also is in the process of selling a New York-based mortgage ...
Nonbank mortgage servicers are bracing for an onslaught of new capital recommendations from the Conference of State Bank Supervisors, which could see the light of day in early 2015. But the industry did receive one piece of good news: although the CSBS is working on what it calls “options for prudential standards,” the organization will not be addressing capital for nonbank originators, a CSBS official told Inside Mortgage Finance. The group is...
Mortgage servicing compliance is about to get even more complicated as the Consumer Financial Protection Bureau late last week proposed changes to its mortgage-servicing regulations on loss mitigation, force-placed insurance disclosures, borrowers in bankruptcy and a host of other matters. On loss mitigation, the bureau is proposing that servicers would have to meet its requirements “more than once in the life of a loan” for borrowers who become current after a delinquency. However, the rule is not clear how many times this could occur over the life of the mortgage. Next, the bureau wants...
The Uniform Law Commission’s latest proposal for a model state act that would regulate foreclosure practices as part of an overlay on current state laws is deeply flawed, according to large servicers represented by the Consumer Mortgage Coalition. In a comment letter submitted to the ULC’s Home Foreclosure Procedures Act Committee last week, Anne Canfield, executive director of the CMC, said the draft HFPA could prompt foreclosure delays and would create new assignee liability. The ULC’s committee on the proposed foreclosure law has been working...
Financial services trade groups called upon federal banking regulators to reinstate the 100 percent risk-weighting for mortgage servicing rights and to implement other changes as they move forward with the new Basel III risk-based capital rules. In a recent joint letter to bank regulatory agencies, the Mortgage Bankers Association, the American Bankers Association and the Independent Community Bankers of America warned that inaction could seriously affect the availability and cost of mortgages to consumers. The trade groups believe...
Two large banks got a break recently as the Securities and Exchange Commission agreed to grant penalty relief to one bank while a New York federal judge dismissed certain claims against the second bank because they were overly speculative. In the first case, the SEC cleared the way for Bank of America to close a $16.7 billion global settlement after SEC commissioners voted to waive additional sanctions that would have taken effect when the settlement is entered into court, according to a report by Bloomberg. The commission agreed...
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