Early indicators suggest that mortgage origination volume was up significantly during the fourth quarter of 2011, but momentum heading into the new year was relatively weak. In earnings reports, eight top lenders have reported solid increases in production levels over the previous quarter, and as a group they posted their best three-month volume of the year. Wells Fargo, U.S. Bank and BB&T reported hefty increases in production during the fourth quarter, with Citi, PHH Mortgage and PNC also putting up big numbers. Chase managed a much smaller increase than its peers, while...(Includes two data charts)

The Consumer Financial Protection Bureau wasted no time in moving forward aggressively with its new director, last week releasing its mortgage origination examination procedures that will be used to scrutinize mortgage lenders and brokers in both the bank and nonbank sector of the industry. The procedures are the clearest indication yet that nonbanks are generally going to be held to the same standards, expectations and requirements as their more traditional banking counterparts. The new procedures outline the CFPB’s supervisory approach to making sure mortgage originators comply with federal...

Fannie Mae and Freddie Mac have drummed up little support for their controversial proposal to pay mortgage servicers a flat fee for performing loans, but one top-tier lender has stepped forward to publicly endorse the idea. Ally Financial in a comment letter to the Federal Housing Finance Agency said it supports the so-called fee-for-service proposal, combined with a policy that would provide for the separation of excess interest-only cash flows from the underlying mortgage servicing rights. The company, which ranked as the fifth-largest servicer in the market as of the end of September, did...

Citing the urgent need to take “immediate action to prevent more foreclosures,” a group of more than two dozen House lawmakers is urging President Obama to appoint a new permanent Federal Housing Finance Agency director via a recess appointment. In a letter sent to the president last week, 28 California Democrats said the FHFA under the stewardship of Acting Director Edward DeMarco has “consistently and erroneously interpreted its mandate” as Fannie Mae and Freddie Mac’s regulator “far too narrowly” and failed to help struggling California homeowners. “As the fiduciary of government-backed...

Bulk sales of real estate owned properties by Fannie Mae, Freddie Mac and the FHA that would become rental properties may help relieve pressure from an excess of inventory for sale, but it will require a change in how the agencies have traditionally handled their foreclosure inventory. The Federal Reserve earlier this month made a strong case for an REO-to-rental strategy, arguing that even if it costs the agencies a little more in foreclosure losses it could help the broader housing market by firming up prices and shifting more units to meet growing demand for rental housing. Many private...

Agency single-family MBS issuance ended 2011 with a bang as the three agencies jostled for market share, a new Inside MBS & ABS analysis reveals. Ginnie Mae and Freddie Mac ended the year with nearly identical total issuance, with Freddie seeing a slightly larger decline from 2010 levels. Fannie Mae, however, recorded a much smaller drop in total production last year, boosting its share of the agency market. Freddie could not keep pace with Fannie’s surging MBS issuance volume during the fourth quarter. In December, Freddie accounted for just 22.7 percent of combined production by the two...

The Securities and Exchange Commission has adopted a modified policy that will require defendants in settlement agreements to admit to wrongdoing if they have already pled guilty in parallel criminal cases. “Following a review by senior enforcement staff that began this spring and separate discussions with the commissioners over the last several months, last week we modified our settlement language for cases involving criminal convictions where a defendant has admitted violations of the criminal law,” said SEC Enforcement Director Robert Khuzami.The new policy does not require admissions...

Reducing monthly payments to a sustainable level for distressed borrowers who are significantly underwater on their mortgages may require principal reductions, in addition to interest rate concessions and loan term extensions, but pursuing such a policy is not without significant drawbacks, according to a Federal Reserve analysis. In a white paper sent to the banking committees on Capitol Hill last week, the Fed dove into the controversial issue of whether Fannie Mae and Freddie Mac should be taking more aggressive steps like principal reduction to help distressed borrowers and shore up...

In a major shake-up of the executive suite, Fannie Mae chief executive Michael Williams announced his resignation this week, effective as soon as the company’s board chooses a successor.Williams’ resignation follows last October’s announcement by Freddie Mac CEO Charles Haldeman that he would step down from the company sometime in 2012.Williams spent 21 years at Fannie in a variety of capacities, most notably as the executive responsible for overseeing the company’s financial restatements, and accounting and control reforms pre-conservatorship and as chief operating officer. In April 2009, he was named CEO.

Despite some commendable improvements in its monitoring of the 12 Federal Home Loan Banks, the Federal Housing Finance Agency’s failure to establish policies, systems and documentation standards threatens to undermine the FHFA’s oversight of troubled FHLBanks, according to a new report by the FHFA’s overseer.The FHFA Office of Inspector General’s first report of 2012 picks right up where it left off last year in the OIG’s persistent criticism of the FHFA’s oversight of the GSEs.Since 2008, four FHLBanks – Boston, Chicago, Pittsburgh and Seattle – have faced “significant financial and operational difficulties,” primarily due to their investments in high-risk mortgage-backed securities. In 2009 and 2010, the four Banks posted losses of nearly $2.0 billion on non-agency MBS investments, the FHFA-OIG noted.