The Federal Housing Finance Agency’s examination program has not made any progress in seven years, according to new report by the FHFA’s Office of Inspector General, which said the number of commissioned examiners has actually decreased. The FHFA is currently conducting an internal review of the program. The IG has been asking the FHFA to beef up its examinations program since 2011. As a result, in 2013 the agency developed its own Housing Finance Examiner Commission Program that offered classroom courses, on-the-job training and final examinations. But the program hasn’t been successful, according to data obtained from the IG.

California remained the top state for Fannie Mae and Freddie Mac activity in the first six months of 2018 as volume reached $68.22 billion, according to a new Inside The GSEs analysis. About 44.4 percent was from the purchase market and 20.8 percent were first-time homebuyers. Texas trailed in second place with $27.57 billion in volume with 69.0 percent of that being attributed to the purchase market. Texas was followed closely by Florida with $25.01 billion. Rounding out the top five for GSE volume were Washington ($16.08 billion) and Colorado ($14.99 billion).

The regular fraud reports created by the GSEs are not being put to good use by the Federal Housing Finance Agency, said the FHFA Office of Inspector General. In fact, FHFA’s examiners don’t even review the reports when supervising Fannie Mae and Freddie Mac activities. In an evaluation report published earlier this week, the IG said the FHFA does not make a documented, systematic use of the content of monthly and quarterly fraud reports that could be helpful for examiners. There’s no specific methodology for fraud detection and reporting, only requiring the GSEs to maintain adequate and efficient internal controls, policies, procedures and an operational training...

Fannie Mae is helping to alleviate some of the additional responsibilities servicers take on during post-foreclosure sales on reverse mortgage loans. In a Sept. 18 announcement, the GSE updated its policy and said it will now take responsibility for ground rents, co-op fees and assessments, and property taxes for certain properties in Fannie’s real estate- owned inventory. The policy change is applicable to all reverse mortgage loans. Last year Fannie also took on additional responsibilities from servicers for post-foreclosure sales. The GSE announced it would pay property taxes for acquired properties with a foreclosure sale date or final acceptance of an executed mortgage release after July 7, 2017.

The outlook for the Federal Home Loan Banks is stable, but Standard & Poors’ Global Ratings points to a few potential weaknesses that could threaten the health of the system. S&P pointed to the small but growing exposure to nondepository financial institutions as a cause for concern. The rating agency also warned of challenges to broad-based advance growth and longer-term uncertainty due to potential legislative changes associated with housing-finance reform. And although the FHLBanks have increased their reliance on short-term funding in response to demand from its members, S&P said, “Given the generally match-funded approach to issuance, as well as the overcollateralization of advances to members, we believe that the tenor of the system's funding remains manageable.”

The Federal Home Loan Banks reported a record $736.70 billion of advances outstanding at the end of June, rebounding from a sharp decline during the first quarter of the year. Outstanding advances at the midyear point were up 5.4 percent from March even though the volume of new advances originated fell 5.9 percent during that period. Still, advance originations exceeded the repayment of existing loans, which declined ... [Includes two data charts}

Commercial banks and savings institutions repurchased only $422.7 million of single-family mortgages during the second quarter of 2018, according to an analysis of call-report data by Inside Mortgage Trends. It was the lowest three-month repurchase total for the industry since regulators began collecting this data back in 2008. Repurchases, including other indemnification for investor losses, were down 42.3 percent from the first quarter. The call-report figures ... [Includes one data chart]

Freddie Mac has racked up between three and five servicing-financing transactions with nonbank agency seller-servicers, according to investment bankers familiar with the arrangements. As for the details regarding the deals, Freddie isn’t talking and neither are any of its clients involved in the pilot. The only firm identified by sources thus far as talking to the GSE about a line of credit collateralized by mortgage servicing rights is United Shore Financial, the parent of the nation’s largest table-funder of loan brokers, United Wholesale Mortgage, Troy, MI. The UWM LOC is sized at roughly $55 million, sources told Inside The GSEs. Both Freddie and UWM declined to comment.

After much anticipation from the mortgage insurance industry, Fannie Mae and Freddie Mac released their updated requirements that private MIs must meet to be eligible to provide mortgage insurance on GSE loans. This is the first time the requirements have been revised since being introduced in 2015.Dubbed PMIERs 2.0, the new private mortgage insurance eligibility requirements will go into effect in March 2019. They serve as a way for Fannie and Freddie to better manage counterparty risks by detailing financial and operational eligibility requirements that private mortgage insurers need to meet, especially as PMIs play a large role in high loan-to-value lending.

Lawmakers who scheduled a hearing about a month ago to discuss oversight of the Federal Housing Finance Agency instead found themselves questioning FHFA Director Mel Watt about sexual harassment claims by one of his employees. During the day-long House Financial Services Committee hearing, which included his accuser Simone Grimes, FHFA Inspector General Laura Wertheimer, and the GSE CEOs, Watt fought back against the allegations. He painted his relationship with Grimes as a mentor/mentee-type interaction and questioned the committee’s decision to even allow Grimes to use that forum when she has a lawsuit pending. But Rep. Maxine Waters, D-CA, who admitted to having a close friendship with Watt, said, “It’s a new...