VA Flunks ‘Plain Writing’ Test. The Department of Veterans Affairs got an “F” for not following the requirements of the Plain Writing Act, which directs federal agencies to take steps to ensure they are communicating clearly with businesses, consumers and stakeholders. The statute went into effect July 2011 and the Center for Plain Language, a nonprofit organization that grades government agencies on their efforts to comply with the Act, evaluated and graded 12 agencies for compliance. The center gave two grades – the first grade represents how well the agency followed the requirements of the act, and the second grade reflects ...

A number of nonbanks have increased their correspondent originations recently with plans to take more market share as the big banks focus on retail lending. Redwood Trust, PennyMac Mortgage Investment Trust, Homeward Residential and others have all touted their recent correspondent efforts, both for agency mortgages and non-agency originations. Since 2010, Redwood has used its conduit platform to supply...

Mortgage insurance activity increased dramatically during the second quarter of 2012, with private MIs gaining ground on the government-insurance programs, according to a new ranking and analysis by Inside Mortgage Finance. A total of $133.22 billion of home mortgages were originated with some form of primary MI coverage during the second quarter, up 22.9 percent from the first three months of the year. It was the biggest quarterly output of primary MI since the middle of 2009, and it lifted insured mortgage originations to $241.64 billion in the first half of the year, up 36.1 percent. Despite a relentless assault on their financial health that has driven three companies into runoff mode, private MIs racked up...[Includes three data charts]

The Department of Housing and Urban Development has expressed concern about a municipal proposal to invoke eminent domain to seize underwater mortgages and refinance them at a lower rate through the FHA Short Refi Program. HUD Press Secretary Derrick Plummer said that while the proposal to use eminent domain to help underwater homeowners remains a local issue, the department would neither support nor endorse such action. He said HUD has concerns about this approach but declined to elaborate. Eminent domain refers to the authority of states to ...

Refinancing borrowers with negative equity through the FHA Short Refinance Program would result in $24,000 in net benefits per refinanced loan, according to the Department of Housing and Urban Development. In its economic impact analysis, HUD said it expects the program to generate $24.5 billion of aggregate net benefits, assuming one million homeowners with underwater mortgages participated in 2011 through 2013. However, the benefits come with a cost and the process is not that easy. The enhanced FHA refinance program is intended to maintain affordable homeownership, prevent foreclosures and mitigate the potential for strategic defaults. The program drew attention in recent weeks ...

The FHA could be the vehicle of a new refinancing plan offered by Sen. Jeff Merkley, D-OR, to help homeowners who owe more on their mortgage than their homes are now worth. In a proposal called “The 4 Percent Mortgage: Rebuilding American Homeownership,” Merkley explained that his plan will not require taxpayer dollars but would rely on proceeds from the sale of government bonds to investors for funding. The aim, Merkley said, is give underwater homeowners the chance to ...

Total FHA delinquency rates as of June 30 were up for 30-, 60- and 90-day delinquencies as was the foreclosure rate for loans with FHA insurance, an Inside FHA Lending analysis of FHA servicing data found. The latest FHA servicers’ data showed an overall 16.75 percent delinquency rate, up from 16.10 percent as of April 30, the last time we reported FHA delinquency and foreclosure rate trends. Fueling this increase is an uptick in 30-60 days delinquencies, which rose to 7.20 percent from 6.61 percent over the two-month period. At the end of June, serviced FHA-insured loans totaled 7,636,852 loans, of which ... (1 chart)

As the Department of Housing and Urban Development prepares for a planned single-family loan sale in September, questions remain as to how successful the Distressed Asset Stabilization Program will be, given its restrictions and additional certification requirements. Legal experts say that the servicer and investor participation requirements are so onerous that the DASP would seem a little more than a sound bite. The DASP expands an earlier pilot program that allows private investors to purchase pools of nonperforming mortgages at a discount before ...

A much-anticipated Senate vote on the nomination of Carol Galante as FHA commissioner and assistant secretary of housing with the Department of Housing and Urban Development failed to materialize this week, reportedly due to the continuing Republican efforts to block her appointment. Word spread that a vote would take place after Senate Majority Leader Harry Reid, D-NV, and Senate Minority Leader Mitch McConnell, R-KY, last week tentatively agreed to vote on the nomination sometime this week. But that has not happened. Both positions have been vacant since ...

Revised VA HAMP. The Department of Veterans Affairs has updated the instructions for modifying mortgage loans with a VA guarantee. Changes include clarification concerning occupancy status, an updated reference to another VA guidance on prior approval procedures and extension of the applicability of the said guidance. The changes were announced in Circular 26-10-6. New VA REO Management and Servicing Contractor. The Department of Veterans Affairs has provided details for transferring VA property management (real estate-owned) and portfolio loan servicing contracts for the VA home loan guaranty program from ...