Deep-freezing the Home Equity Conversion Mortgage program’s full-draw, fixed-rate standard product apparently has not diminished borrowers’ appetite for reverse mortgages as indicated by a significant increase in HECM originations in the first quarter of 2013. FHA endorsements under the HECM program surged 36.2 percent during the first three months of 2013, with lenders reporting $3.84 billion at the end of the quarter, according to Inside FHA Lending’s analysis of FHA data. Volume was also up a modest 5.3 percent from the same period a year ago. The Department of Housing and Urban Development announced the ... [1 chart]
HUD Explains ‘Good Neighbor Next Door’ Program. The Department of Housing and Urban Development has issued Mortgagee Letter 2013-20 to clarify certain things about the FHA’s Good Neighbor Next Door Sales program. The program allows eligible borrowers to purchase, at 50 percent off the list price, a HUD-acquired single-unit home located in an area that the department has targeted for revitalization. According to HUD, the mortgage insurance premium should be based on the first mortgage only. The agency also clarified the process for allowing interruptions to ...
The City Council of North Las Vegas, NV, is the latest local jurisdiction to be drawn by the eminent domain siren song of Mortgage Resolution Partners, despite the near-certain prospects of eventually crashing upon the rocks of opposition from federal agencies. Last week, the city council voted four-to-one in favor to approve a two-month advisory services agreement with MRP to advise the city on the seizure of mortgage loans through the use of eminent domain. Under the parameters of the agreement, MRP is to inventory potential loans in North Las Vegas that could be affected by its program, at no cost to the city, and to design a program for those loans that are inventoried. That program is to be brought back before the city council within 60 days at its Aug. 21, 2013, meeting. Also, the agreement prohibits...
The Department of Housing and Urban Development is seeking additional authority from Congress to transfer FHA mortgage servicing in order to facilitate loss mitigation. The change would allow the FHA to require specific actions when a servicer is underperforming or has a low score on HUD’s Tiered Ranking System, including the transfer of servicing to an FHA-designated special servicer or requiring a servicer to enter into a sub-servicing agreement. With expanded powers, the FHA also may require a servicer to engage a third-party to assist in loss mitigation services. Such authority would enable the FHA to better avoid losses due to poor servicing and, thus, protect the MMI Fund, HUD said. Testifying before a Senate appropriations subcommittee, FHA Commissioner Carol Galante noted...
“Confusion and uncertainty around representations and warranties standards continue to cause lenders to add their own overlays to the existing GSE credit standards,” said MBA vice chairman Bill Cosgrove.
The expanded system would include a more comprehensive method for measuring lenders’ loss mitigation activities as well as their compliance with FHA’s default servicing requirements.
Fed Chairman Ben Bernanke indicated that the central bank is leaning toward scaling down its MBS purchases later this year, and that rapidly rising mortgage interest rates don’t pose a major threat to the fledgling housing recovery.
The Supreme Court of the United States announced this week that it will hear a legal dispute that would determine whether the Fair Housing Act – and perhaps, by extension, the Equal Credit Opportunity Act – permit claims under the “disparate impact” theory of discrimination. “The threshold issue on appeal is whether plaintiffs may use disparate impact to allege a violation under the Fair Housing Act rather than proving liability by demonstrating an actual intent to discriminate,” explained attorneys with the Dykema Gossett law firm. In Township of Mount Holly, New Jersey v. Mt. Holly Gardens Citizens in Action, the plaintiff citizen group is challenging...
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