In what is likely the first such case of its kind, a law firm headed up by former Ohio Attorney General Marc Dann, D, brought suit last month in the Eastern Division of the U.S. Northern District Court of Ohio against JPMorgan Chase, alleging the lender violated the new mortgage servicing regulation promulgated by the CFPB. According to court documents, homeowner Bethanne Wasko, of Poland, OH, was always current on her mortgage until she sought a loan modification and was told by Chase that she would need to stop making payments in order to be eligible. Wasko did as she was told, her attorney’s filing said, but instead of offering her the modification she sought, the bank filed for foreclosure. ...

The American Bankers Association told the CFPB its members are working hard to refine their implementation of the bureau’s new mortgage servicing rules, but have bumped into a handful of questions and concerns they’d like the agency to address via regulatory guidance or amendment. The first issue involved rolling delinquencies and the “120-day rule.” The bureau’s rule prohibits a servicer from making the first notice or filing for foreclosure unless a borrower’s mortgage loan obligation is more than 120 days delinquent. Many ABA members asked how this 120-day rule applies to “rolling delinquencies,” which occur when delinquent borrowers resume making payments on the loan without making up for past missed payments. “ABA members need regulatory certainty regarding how to apply ...

FHA violations were related to lender approval, loan origination and mortgage servicing practices.

The seller, which IMA would not identify, hopes to close the sale by Sept. 30. Just over 5,050 loans are in portfolio, which is top heavy in California.

Fannie Mae and Freddie Mac actually withdrew $881.5 million of buyback demands, more than lenders repurchased during the first quarter.

A Manhattan federal judge on Wednesday ordered Bank of America to pay a $1.27 billion penalty over mortgage fraud related to Countrywide Financial’s “Hustle” program, a little more than half of what the government had said the bank should pay, while the bank and Department of Justice discuss a potential MBS fraud settlement. Last October, the DOJ and the Securities and Exchange Commission successfully proved in court that Fannie Mae and Freddie Mac lost some $850 million from thousands of loans acquired through Countrywide’s “high-speed swim lane” program – known as HSSL or “Hustle.” The loan program ran...

Close compliance with the mortgage servicing rules promulgated by the Consumer Financial Protection Bureau will continue to be a critical concern for servicers this year. Analysts at DBRS anticipate intensified scrutiny from the CFPB and a higher likelihood of fines and lawsuits from noncompliance and even technical errors. “DBRS believes that the issuance of the mortgage servicing rules has brought much-needed reform to the servicing industry,” the analysts said in a new report. It was...

Next week, Nationstar Mortgage reports its second quarter results. If the company misses the targets set by investment bankers, it could be a blood bath…

Flagstar Bank has $802 million in interest-only mortgages that are scheduled for principal payments to kick in over the coming years, and in some cases the borrower’s monthly mortgage payment will double. Officials at the bank said Flagstar is working with borrowers that have IOs and delinquencies have been low thus far. “We’ve put a dedicated team together to get ahead of these resets,” Lee Smith, Flagstar’s COO, said last week during the bank’s earnings presentation ...

For FHA lenders, the idea of a large lender exiting the FHA market and creating opportunities for market share has been overshadowed by concerns regarding liability in the wake of recent fraud-related settlements between lenders and the federal government. Compliance experts said many of their FHA clients are quietly reassessing their FHA business after JPMorgan CEO Jamie Dimon, during a recent earnings call, spoke out loudly against the government’s stringent enforcement actions aimed at recovering “wrongfully” claimed funds. Lenders fear that FHA enforcement actions have taken a turn for the worse in recent years, and that even errors that have nothing to do with loan default are construed as fraud by government prosecutors, resulting in billion-dollar penalties against FHA lenders. Seven major banks, so far, have paid ...