As Fannie Mae and Freddie Mac continue to unload distressed home loans, Sen. Elizabeth Warren, D-MA, along with Rep. Michael Capuano, D-MA, led a protest last week urging the GSEs and the Department of Housing and Urban Development to not keep selling the loans primarily to private-equity firms and hedge funds. They want to level the playing field so that nonprofit groups have a chance at the loans. Inside Mortgage Finance reported in 2013 that its sources noted that some buyers are turning to the nonperforming loan market as a “back door” way to buy homes. Capuano cited a recent New York Times article about private-equity firms buying troubled home mortgages and said the piece “highlights the troubling approach being taken by...

The nation’s seven active mortgage insurance firms expect to be fully compliant with the Federal Housing Finance Agency’s new capital eligibility rules by the yearend deadline – if they aren’t already – but now there’s a new worry: more regulations may be on the way. According to sources inside the MI sector, the FHFA is taking a close look at the use of reinsurance by private mortgage insurers with an eye toward capping it. “FHFA is worried that reinsurance firms may not pay,” said one MI official who spoke extensively on the topic under the condition he and his firm not be identified. “They want to reduce the credit you get for using reinsurance firms.” “The FHFA is trying...

The results of a new survey conducted for NeighborWorks America suggest that student loan debt is an obstacle for a growing share of potential homebuyers. The congressionally chartered organization with a focus on housing counseling also found confusion among potential homebuyers regarding the mortgage market. Some 57 percent of respondents said student loan debt was an obstacle to purchasing a home, up from a 49 percent share last year. The survey involved 1,000 adults. And 76 percent of respondents with student debt said the homebuying process is complicated, up from a 70 percent share in 2014. The greatest obstacle for potential homebuyers continues...

The full House of Representatives is expected to vote sometime this week on legislation that would provide a regulatory and legal safe harbor for mortgages originated under the CFPB’s Truth in Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure (TRID) rule until Feb. 1, 2016. Speaking of the legislation at issue, H.R. 3192, the Homebuyers Assistance Act, House Majority Leader Kevin McCarthy, R-CA, said, “This bipartisan bill provides certainty to businesses that are trying to comply with the rule as well as an opportunity to work out any implementation issues that come up.” One industry observer who anticipates a “big margin” vote indicated he expects the bill will split rank-and-file Democrats from their caucus leadership. Meanwhile, industry readiness continues to ...

Last week, the Republican-controlled House Financial Services Committee passed H.R. 1266, the Financial Product Safety Commission Act of 2015, which would replace the CFPB’s sole director with a bipartisan, five-member commission. In the run-up to the vote, a number of industry groups came out in support of such a bipartisan leadership structure for the bureau, noting in an op-ed in The Hill newspaper that then-professor Elizabeth Warren and the Obama administration both envisioned a pro-consumer regulatory agency with just such a commission. And in a letter to the committee leadership, a number of the groups made that same point while also noting such a commission leadership structure had the support of two key Democrats during the passage of the Dodd-Frank ...

Real estate investment trusts that have gained access to Federal Home Loan Bank advances don’t seem particularly worried that they will be kicked out of the system, at least not anytime soon. As for when the Federal Housing Finance Agency will issue a final membership rule that addresses the thorny topic, that’s a different matter. The FHFA formally proposed changes a year ago that would ban captive insurance companies, the vehicle through which all REITs have gained membership. Even though public comments were taken, no final rule has appeared. In some circles, the “no action” stance is being read...

It looks like the mortgage industry is on the verge of obtaining another concession from the Consumer Financial Protection Bureau regarding enforcement of its pending integrated disclosure rule. The rule will streamline the consumer disclosures required under the Truth in Lending Act and the Real Estate Settlement Procedures Act. This TILA/RESPA Integrated Disclosure rule is slated to take effect Oct. 3, 2015, and will create a new regulatory regime – and perhaps a good bit of havoc in the process, at least in the short term. The anxiety over the confusion and expected delays has prompted...

A streamlined version of the “Jumpstart GSE Reform Act,” recently reintroduced in Congress, then placed on hold and reintroduced again, could be considered before the end of the year. The bill, sponsored by Sens. Bob Corker, R-TN, Mark Warner, D-VA, and Elizabeth Warren, D-MA, would bar the Treasury from selling its stock in the two government-sponsored enterprises and prevent increases in Fannie Mae and Freddie Mac guaranty fees to pay for other government spending. An earlier version of the bill that Corker tried to fast-track through the Senate did not include...

Industry groups stepped up their pressure on Congress to block a proposed rule that would alter membership requirements in the Federal Home Loan Bank system. The latest letter came this week and was signed by the Mortgage Bankers Association, National Association of Real Estate Investment Trusts, Independent Community Bankers of America and Habitat for Humanity International. The Federal Housing Finance Agency proposed...

Nearly 100 approved issuers will be dismissed from the Ginnie Mae MBS program for failing to be active participants, according to a top agency official. Michael Drayne, senior vice president and head of the Office of Issuer and Portfolio Management at Ginnie Mae, said the agency is currently working through all of the Ginnie I (multifamily) and Ginnie II (single family) issuers that have not issued a single security since their approval. Drayne estimated...