FHFA Launches ‘Servicing Project’ to Watch Counterparty Risk. The Federal Housing Finance Agency has launched what industry officials have labeled “a servicing project” to keep an eye on all large servicing sales where the underlying collateral is guaranteed by Fannie Mae and Freddie Mac. Sources briefed on the effort said the FHFAis now officially asking that the GSEs get agency approval for any sales of mortgage servicing rights where 25,000 or more in loans are being transferred. This translates into deal sizes of at least $5 billion.

An entirely new mortgage market was formed on Jan. 10, 2014, but it remains to be seen who is in it, who will get in and what the sector will be made of. The landing of the ability-to-repay rule two weeks ago created two categories of qualified mortgages – prime and nonprime – plus a non-QM market. The new rule is going to limit the opportunities for lenders to move beyond the ultra-conservative standards of the past few years, but it won’t prevent a gradual expansion of credit ...

One sign of just how seriously Congress took the issue of consumer disclosure in the aftermath of the mortgage market meltdown is the dramatic escalation lenders will face for violating the new integrated disclosures from the Consumer Financial Protection Bureau, which take effect Aug. 1, 2015. Consider this: Under the Truth in Lending Act, lenders face a private right of action for violations (along with attorney’s fees and costs), as well as statutory penalties of up to $4,000 for failures to ...

The non-agency MBS market is stuck in "limbo until we know where the GSEs are going,” said Steve Abrahams, head of securitization and MBS research at Deutsche Bank Securities.

Speculators in Fannie Mae/Freddie Mac junior preferred shares will benefit if they can prove loan loss reserves at the two were over-stated.

The integration of TILA and RESPA has "been a goal almost since the time the two statutes were issued, and certainly from the time the good-faith estimate began focusing on loan terms,” said Benjamin Olson of BuckleySandler.

When Fannie Mae and Freddie Mac unveil their fourth-quarter 2013 results in February, the two government-sponsored enterprises are expected to again report strong earnings driven by: higher guaranty fee income, one-time gains tied to legal settlements, and a boost from lower loan-loss reserves. But most of the money will be swept straight into the U.S. Treasury. One of the major factors in the GSEs’ huge 2013 earnings so far – the release of deferred tax assets – will likely be...

Michael Stegman, counselor to the Treasury Department on housing-finance policy, said this week that legislation to reform the government-sponsored enterprises is a top priority for the Obama administration. However, industry analysts suggest that Congress is unlikely to pass such legislation anytime soon, leaving the Federal Housing Finance Agency as the driver of GSE reform. “Indefinitely continuing a taxpayer-backed duopoly is neither sustainable nor sensible public policy,” Stegman said this week at the ABS Vegas conference sponsored by the Structured Finance Industry Group and Information Management Network. He pushed...

Mortgage lenders may be suffering from compliance burnout these days after getting up to speed with major new rules from the Consumer Financial Protection Bureau. But they would do well to start preparing now for the bureau’s revolutionary integrated mortgage disclosure rule that aims to change the way consumers shop for such loans and how lenders go about originating them. “The integration of the Truth in Lending Act and the Real Estate Settlement Procedures Act mortgage disclosures has been a goal almost since the time the two statutes were issued, and certainly from the time the good-faith estimate began focusing on loan terms,” Benjamin Olson, counsel at BuckleySandler, said during a webinar sponsored this week by Inside Mortgage Finance. The new disclosures become mandatory Aug. 1, 2015. Joseph Kolar, a partner with BuckleySandler, pointed...

The Urban Institute said that new FHA loan limits may have a limited impact overall, but they could have dire consequences for some minority neighborhoods. The study found that the most affected metropolitan statistical areas had two things in common: they have a high share of FHA-insured loans, and their loan limits have dropped significantly. Of the 35 most affected MSAs, 13 are predominantly minority neighborhoods, all in California. “Many of the most affected areas have...