Top servicers flagged for their faulty foreclosure practices will have an extra month to submit their mitigation plans, although federal regulators continue to bear down on the industry and are starting to withhold loss mitigation incentive payments from some companies. The Office of the Comptroller of the Currency and the Office of Thrift Supervision this week said they will give 12 servicers subject to consent orders extra time to submit “comprehensive action plans” that detail the financial resources the bank will commit to...

The supply of home mortgage debt fell again in the first quarter of 2011 despite an increase in agency servicing, according to an Inside Mortgage Finance analysis of new data released by the Federal Reserve. Outstanding home mortgage debt declined to $10.458 trillion as of the end of March, down 0.7 percent from the end of 2010. That marked the 12th consecutive quarterly decline in the supply of mortgage servicing and took the market back to a level not seen since the end of 2006. Since peaking in the first quarter of 2008, the volume of home mortgage debt outstanding has...[includes two data charts]

Fannie Mae and Freddie Mac’s home retention activity declined for the most part during the first quarter, according to the latest Federal Housing Finance Agency’s Foreclosure Prevention and Refinance Report.Total home retention efforts dropped to 143,977 during the first three months of the year, down 20 percent from the fourth quarter, while loan modifications in the period also declined to 86,201, down 28 percent.

Ocwen Financial Corp. is poised to significantly expand its mortgage servicing business with the acquisition of Litton Loan Servicing from Goldman Sachs Group for approximately $264 million. The sale price does not reflect certain assets that Goldman will retain, the investment bank said in a June 6 statement announcing the deal. The bank did not specify which assets would be excluded from the transaction. The planned sale will end...

The Treasury Department this week announced that it is withholding servicer incentive payments for the three largest lenders in the industry following compliance reviews that found them needing significant improvement in their Home Affordable Modification Program activity. The three servicers – Bank of America, JPMorgan Chase and Wells Fargo – each typically collect about $7 million a month in servicer compensation for non-agency mortgages, according to an Inside Mortgage Trends analysis of Treasury data. Treasury found a fourth servicer – Ocwen Financial – was also in need of...[contains one data chart]

Servicers must achieve “quality right-party contact” (QRPC) with borrowers as a means of determining a delinquent homeowner’s willingness and ability to pay his mortgage under new standards Fannie Mae has laid out regarding the management of loans in danger of default.Fannie’s issuance of servicing standards this week is in compliance with the Federal Housing Finance Agency’s Servicing Alignment Initiative announced in late April to establish consistent mortgage loan servicing and management requirements for servicers acting on behalf of Fannie and Freddie Mac.

The states and the federal government continue to rack up some key legal settlements with various mortgage servicers. One such settlement was brought about by the Ohio Attorney General and the state Department of Commerce against Carrington Mortgage Services involving a lawsuit that was filed against the subprime servicer back in 2009. The two Ohio agencies and Carrington agreed to mortgage servicing standards that will apply...

Bank of America and Saxon Mortgage Services last week agreed to separate settlements with the Department of Justice over allegations the firms wrongfully foreclosed on active-duty members of the U.S. military in violation of the Servicemembers Civil Relief Act of 2003.The federal government wants the settlements to function as a compliance model for other servicers addressing foreclosure-related issues involving borrowers actively serving in the military.BAC Home Loans Servicing LP, the former Countrywide Home Loans Servicing LP, agreed to pay $20 million to resolve...

Facing significant penalties from investigations by the Securities and Exchange Commission, Wall Street banks are bracing for investigations of their securitization activities by the influential New York attorney general’s office and other state regulators. NY Attorney General Eric Schneiderman has reportedly launched an investigation into the securitization processes of Bank of America, Morgan Stanley, Goldman Sachs, JPMorgan Chase, UBS and Deutsche Bank. All the parties declined to comment, but reports say that the AG is looking into how the banks securitized mortgage loans, as well as their other practices handling mortgage loans. Specific concerns have...

Nationstar Mortgage Holdings aims to raise $400 million through the sale of common stock to finance new growth opportunities in subservicing delinquent home loans, as well as in originating and securitizing new mortgages. Texas-based Nationstar, the home finance unit of Fortress Investment Group, announced the filing of an initial public offering with the Securities and Exchange Commission. Nationstar said it sees opportunities in the current residential mortgage market for non-bank servicers to grow their portfolios by acquiring mortgage servicing rights, entering into subservicing contracts and by assuming responsibilities for...