Rep. David Schweikert, R-AZ, said this week that in the coming months he will introduce bipartisan legislation to establish a regulatory framework for prime non-agency MBS. Ive spent the last two years trying to figure out what the box will look like, he said. Non-agency MBS participants continue to debate whether reform of the government-sponsored enterprises is necessary before the non-agency MBS market can return in a meaningful manner. At the ABS East conference sponsored by Information Management Network this week in Miami, Schweikert said a functioning non-agency MBS market is necessary before members of Congress can be convinced to move forward with GSE reform. I need to have...
Regulatory uncertainty continues to frustrate mortgage bankers who can see the outlines of major pending changes in consumer protection, securitization rules and capital requirements that remain largely enshrouded in bureaucratic fog. We have these new concepts, qualified mortgages and qualified residential mortgages, but we dont know what their exact definitions are, said Michael Heid, president of Wells Fargo Home Mortgage, during a panel session at this weeks annual convention of the Mortgage Bankers Association in Chicago. We are in a gray state; the concepts are there, but the rules arent. At the same time were having to clean up issues from the past. Debra Still, president and CEO of Pulte Mortgage, said...
Fannie Mae, Freddie Mac and Ginnie Mae officials pledged to continue efforts to build a better secondary market system while coping with the business challenges of dealing with an increasingly diverse universe of lenders delivering loans directly to the agencies. Fannie Mae is a different company today, said Timothy Mayopoulos, president and CEO of the firm, during a panel session at this weeks annual convention of the Mortgage Bankers Association. He said 80 percent of the government-sponsored enterprises upper management has been promoted to their roles or hired since the GSE went into conservatorship four years ago. Half of the companys 7,000 employees have been hired since then. The people of Fannie Mae today are...
The Federal Housing Finance Agencys internal watchdog said Fannie Mae and Freddie Mac could mitigate more losses if they recover mortgage deficiencies from borrowers more efficiently. An FHFA Office of Inspector General report found weaknesses in the ability of the government-sponsored enterprises to collect shortfalls from borrowers from post-foreclosure sales. In 2011, the GSEs recovered only a small fraction of the deficiencies they pursued, an estimated $4.7 million collected out of $2.1 billion pursued, the IG reported. The IG blames this on the FHFAs lack of guidance and oversight of the GSEs deficiency recovery efforts. While the FHFA has an opportunity to provide...
The U.S. Attorney for the Southern District of New York opened a new battlefront in intense warfare over losses taken by investors and others in the collapse of the housing market. The government this week filed charges against Bank of America, as the party left liable for activities at Countrywide Home Loans, based on the False Claims Act, a federal law that provides for hefty treble damages and penalties. The FCA has been used in recent mortgage-related charges involving FHA loans, but the new filing attempts to expand the law to loans sold to Fannie Mae and Freddie Mac. In its filing, the government contends...
Recent efforts by the government-sponsored enterprises and the Federal Housing Finance Agency to offer clarity and consistency about repurchase demands may or may not bear fruit as neither agency officials nor industry observers can speak confidently as to its ultimate effectiveness. According to participants at an Inside Mortgage Finance webinar this week, the GSE representation and warranty framework unveiled by the FHFA last month and the GSEs new quality control guidelines announced last week are steps in the right direction but there are a lot of moving parts to take into account. We tried the best we could to address...
Advocates for GSE reform say recent actions by the Treasury and the Federal Housing Finance Agency have made it more important than ever for policymakers to start moving Fannie Mae and Freddie Mac away from government support or risk seeing the two enterprises enveloped forever within the federal budget. Two former Bush administration Treasury officials made their case this week in a Washington Post opinion piece, citing the governments recent sale of stock in insurance giant American International Group to recoup the bailout billions Uncle Sam floated the company during the financial crisis as an admittedly inexact blueprint for Congress and the White House to follow to get the feds out of Fannie and Freddie.
More than a year after the Federal Housing Finance Agency first announced its proposal to sell investors Fannie Mae foreclosed properties in bulk for rentals and two months into its second sale with less than 800 properties moved, market watchers are expressing skepticism about whether the program will ever advance beyond the pilot stage. Earlier this month, the FHFA announced that New York-based Cogsville Group LLC was the winning bidder of 94 Fannie-owned properties. The firm paid $2.1 million for a share in a joint venture with the GSE resulting in a transactional value to Fannie of $11.8 million or 86.2 percent of the properties estimated value.
The Federal Housing Finance Agency has proposed a rule to acquire explicit discretionary authority to require Fannie Mae, Freddie Mac or any of the 12 Federal Home Loan Banks to undergo a stress test every year, no matter how much the GSEs have in consolidated assets. The proposed rule, published in the Oct. 5 Federal Register, would implement a part of the Dodd-Frank Act, which requires certain financial companies with consolidated assets of more than $10 billion, and which are regulated by a primary federal financial regulatory agency, to conduct an annual stress test.
Fannie Maes and Freddie Macs home retention activity declined for the most part during the second quarter of 2012, according to a new analysis of Federal Housing Finance Agency data by Inside The GSEs. Total loss mitigation activity total home retention efforts and foreclosure alternatives combined declined 11.4 percent during the second quarter of the year to 190,315. Total loss mitigation for the first six months of the year fell 18.6 percent to 405,127 compared to the same six-month period in 2011.