Senate Democrats would like to see the Federal Housing Finance Agency loosen even further the refinancing restrictions on GSE mortgages and they’ve got a couple of pointers on how to make it so. Last week, Democrats on the Senate Banking, Housing and Urban Affairs Committee, led by Chairman Tim Johnson, SD, wrote FHFA Acting Director Edward DeMarco to encourage the Finance Agency to take the Home Affordable Refinance Program beyond HARP 2.0.

Three former Fannie Mae executives, including the company’s one-time CEO, have petitioned a federal judge to toss the securities fraud case the government filed against them late last year. Filed last week in the U.S. District Court for the Southern District of New York, the motion to dismiss contends the Securities and Exchange Commission is thin on proof that the GSE, at the direction of the then top executives, failed to disclose to investors the companies’ exposure to subprime mortgages prior to the 2008 housing market crash.

Although it questions the appropriateness of Fannie Mae and Freddie Mac funding charitable activities while the two companies remain under government conservatorship, the Federal Housing Finance Agency’s official watchdog has concluded that the FHFA has the dissolution of the GSEs’ charity funds in hand. The recent report by the FHFA’s Office of Inspector General noted that at the time the conservatorships were established 3½ years ago, both companies had long-standing mechanisms in place to make “substantial contributions” to charitable organizations. In 2008, both GSEs’ charitable giving totaled $73 million.

Mortgages modified by Freddie Mac performed slightly better than Fannie Mae loans in the short term while the performance gap between the two GSEs widened further one year after modification, according to the Office of the Comptroller of the Currency.OCC’s latest Mortgage Metrics Report noted that Freddie loans had an 11.3 percent re-default rate three months after modification, while Fannie mods saw an 11.7 percent rate. At the six-month mark, Freddie stood at 18.1 percent compared to Fannie’s 18.8 percent.

Roughly one out of every 14 banks in the country suffered significant investment losses following the September 2008 government takeover of Fannie Mae and Freddie Mac, according to a new Federal Reserve discussion paper. The paper, When Good Investments Go Bad: The Constriction in Community Bank Lending After the 2008 GSE Takeover, details how financial institutions took a bath when the two companies were placed into conservatorship and dividend payments on common and preferred shares were suspended.

If mortgage lending profitability was directly correlated to an ability to respond satisfactorily to borrower complaints, a lot of mortgage bankers might be looking for a new line of work. In 768 cases (46.7 percent) initially tracked by the Consumer Financial Protection Bureau, mortgage lenders reported they closed a consumer complaint without providing any relief whatsoever, according to the bureau’s first semi-annual report to Congress, submitted to the House Financial Services Committee last week. Credit card gripes, on the other hand, were closed without any reported relief in 27.7 percent of the...

Mortgage lenders delivered a hefty $303.9 billion in single-family home loans to Fannie Mae and Freddie Mac securitization programs during the first quarter of 2012, the biggest flow of new business to the government-sponsored enterprises in over a year, according to a new analysis and ranking by Inside Mortgage Finance. During the first three months of 2012, GSE single-family securitization jumped 16.2 percent from the fourth quarter. It marked the fourth straight quarterly increase in production of Fannie and Freddie mortgage-backed securities after the market troughed...(Includes three data charts)

The Federal Housing Finance Agency expects to finish its latest assessment of principal reductions on Fannie Mae and Freddie Mac loans sometime this month against a backdrop of intensifying public debate over the issue. The Treasury Department this week fought back against claims that its proposed incentive payments to the government-sponsored enterprises, if they agree to principal reduction loan mods, would be a “backdoor bailout” for banks that service these loans. Treasury earlier this year offered to pay the GSEs the same incentives that other investors get for principal reduction loan mods under...

The general pickup in housing activity in early 2012 is welcome news for a mortgage industry both gearing up to unload significant numbers of foreclosed properties and looking to increase home purchase financing this year. But the fact that investors are driving much of the recent surge in home sales is not necessarily good news for mortgage interests. According to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey, the investor share of home purchases hit a record-high of 24.2 percent in February based on a three-month moving average. That was up from a 20.9 percent...

Certain watchdog agencies of the federal government have expressed concern to Congress about whether additional steps already taken by the FHA and Ginnie Mae to improve their risk management are sufficient to avert potential government intervention. A recent study by the General Accountability Office and testimony by Department of Housing and Urban Development Inspector General David Montoya before a House panel have raised questions about the financial stability of the FHA and Ginnie Mae and their ability to respond to a major financial crisis. Both the GAO and Montoya concluded that the two agencies...