The Treasury Department’s surprise move in the summer of 2012 to rewrite the Senior Preferred Stock Purchase Agreements it had with Fannie Mae and Freddie Mac was an “unlawful” action that could have a far-reaching impact well beyond the shareholders of the two government-sponsored enterprises, according to an attorney representing shareholders. Speaking Wednesday at a forum sponsored by Ralph Nader’s Shareholder Rights advocacy group, attorney Ted Olson of Gibson Dunn & Crutcher said Treasury’s Third Amendment to the PSPA was a calculated effort by the Obama administration to ensure that GSE stockholders got nothing, according to internal Treasury documents they obtained. The amendment replaced the quarterly GSE dividend payment with a net-worth sweep of all company profits. Perry Capital, represented by Olson, is...

The Federal Reserve’s move to reduce its purchases of agency mortgage-backed securities may eventually change the relative costs and benefits of financing new production through Fannie Mae, Freddie Mac and Ginnie Mae. “We’re in an environment where I think banks are going to get interested in at least the more attractive credit risks and holding those in portfolio,” said Mark Calabria, director of financial regulation studies at the libertarian Cato Institute in Washington, DC. “So, to me, the most important question going forward over the next two years for the MBS market is how much of this [new production] is going to make its way into MBS and how much will be held on balance sheets as whole loans.” Calabria predicted...

Morgan Stanley notes: “The agreement in principle is subject to final approvals by the parties. In connection with the settlement, the company will record an addition to legal reserves of $150 million, which will have the impact of reducing income..."

Treasury’s “Third Amendment” to the PSPA – which replaced the quarterly GSE dividend payment with a “net worth sweep” of all company profits – was the culmination of a calculated administration effort, according to former Solicitor General Ted Olson.

The starting salary for the CEO is said to be about $450,000 plus benefits, which is roughly double what the new director of the Federal Housing Finance Agency, Mel Watt, earns.

A veteran player in the jumbo ARM market said one investment bank in particular has “had lots of layoffs.”

Consumer advocate Ralph Nader has spent years demanding satisfaction for GSE shareholders from the Obama administration, regulators and members of Congress.

Industry advisors briefed on the servicing project noted that changing the minimum 25 basis point servicing fee has some firms on edge.

It's nice to know that some lenders are willing to take on risk. Check out the new FHA/VA product from New Penn Financial: a 560 FICO minimum.

The qualified mortgage is here, and while the rotation of the earth has yet to slow, there are still several areas of the regulation that are not crystal clear to much of the industry, including some questions having to do with Fannie Mae and Freddie Mac purchases of mortgages being originated under the new regime. For instance, “If lenders bake the loan-level price adjustments into the interest rate, are they allowed to show those adjustments to the originator? If they show them, will the CFPB count them into the points and fees?” asked Tammy...