Members of Congress are leaning on the Department of Housing and Urban Development to loosen FHA underwriting standards for condominiums, echoing trade group concerns, although most financing for these properties is provided by Fannie Mae and Freddie Mac. The letter from 69 congressmen, which included members from both sides of the aisle, asked HUD to relax guidelines on owner-occupancy limitations which require that at least 50 percent of a building’s units be occupied for borrowers to be eligible for FHA financing. They also want the FHA to ease up on delinquent assessment standards and certification...

Mortgage industry officials are anxious about the Consumer Financial Protection Bureau’s upcoming rulemaking on mortgage servicing and have provided some empirical data and a number of principles they think the bureau ought to follow. The American Bankers Association recently provided the CFPB with excerpts from its annual real estate survey to influence the CFPB’s determination as to whether it should exempt, in whole or in part, certain categories of servicers or servicing arrangements from the bureau’s upcoming servicing requirements. Of the 186 banks that participated, roughly 86 percent had assets of...

The Department of Housing and Urban Development is working on a mortgagee letter to guide FHA-approved lenders on their use of credit overlays to protect themselves from potential liability in single-family mortgage transactions. In remarks at a Women in Housing and Finance meeting this week in Washington, DC, Acting FHA Commissioner Carol Galante said the department is concerned about FHA lenders boosting credit score requirements much higher than what the FHA would allow. Galante said lenders are requiring credit scores of 700 and higher, well above the traditional FHA score requirement of 640...

The three federal banking agencies over the past week released proposed rules to implement the Basel III regulatory capital reforms and changes required by the Dodd-Frank Act that many observers predict will influence bank participation in the mortgage market. The proposed changes would increase bank capital requirements and re-calibrate risk-based capital charges. One of the key changes stemming from the Basel III accord reached by international bank regulators would limit the amount of mortgage servicing rights, along with investments in certain non-consolidated entities and deferred taxes, to no more...

A total of 221 rulemaking requirement deadlines mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act have passed, through the first five months of the year, according to the latest Dodd-Frank progress report prepared by the Davis Polk law firm. gThis is 55.5 percent of the 398 total rulemaking requirements, and 78.9 percent of the 280 rulemaking requirements with specified deadlines,h according to the report. Further, of the 221 deadlines that have passed, 148 (67.0 percent) have been missed and 73 (33.0 percent) have been met with finalized...

Conference of State Bank Supervisors. Last week, the Conference of State Bank Supervisors and the Nationwide Mortgage Licensing System & Registry issued for the first time two quarterly publications that together present a comprehensive overview of all individuals, mortgage companies and depository institutions that make residential mortgage loans in the United States. The Nationwide View of State-Licensed Mortgage Entities collects data on companies, branches and mortgage loan originators who are state-licensed or state-registered through the NMLS. The document presents information about...

Office of Mortgage Settlement Oversight. BDO Consulting Tapped. Joseph Smith, monitor of the national mortgage settlement, has selected BDO Consulting, a division of BDO USA, LLP, as his primary professional firm. BDO will join Smith and his team for a period of three and a half years as they oversee the implementation of the settlement involving 49 states, the U.S. government and five of the nationfs largest banks. gAs I entered the process of engaging the primary professional firm, I knew it would be critical to find the right balance of independence and capacity, Smith said...

In the case of Brisbin v. Aurora Loan Services LLC, the U.S. Court of Appeals for the Eighth Circuit has ruled that a lender’s oral promise to postpone foreclosure is unenforceable; that is, that such a promise is a credit agreement that has to be in writing if it is to be enforceable. Borrower Alison Brisbin filed this lawsuit in Minnesota state court against Aurora Loan Services LLC, Mortgage Electronic Registration Systems Inc. and Freddie Mac, seeking legal and equitable relief from the foreclosure and sale of her home. She alleged three legal theories for invalidation of the...

The California Assembly and Senate unanimously passed identical six-bill packages known as the California Homeowner Bill of Rights to simplify the state Attorney General’s ability to initiate and conduct statewide grand jury mortgage fraud investigations. The legislation has been designed to guarantee:Basic standards of fairness in the mortgage process, including an end to dual-track foreclosures.Transparency in the mortgage process, including a single point of contact for homeowners....

The Consumer Financial Protection Bureau and the four prudential regulators have released a ¡°Memorandum of Understanding on Supervisory Coordination¡± that clarifies how they plan to coordinate their supervisory activities, consistent with the Dodd©\Frank Wall Street Reform and Consumer Protection Act. Dodd©\Frank requires the CFPB and the prudential regulators ¨C the Federal Reserve, the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency and the National Credit Union Administration ¨C to synchronize important aspects of their supervision of insured...