A law professor says there is no quick solution to the mortgage industry’s foreclosure mess and the resulting legal chaos, but moving to a single electronic note/mortgage transfer system would solve much of what caused the crisis to begin with. “Massive originations of mortgage loans relying on the sell-to-distribute model, followed by massive foreclosures, have led to chaos in the legal processes to track who may foreclose and sell homes,” said Alan White, professor of law at Valparaiso Law School ...

The former chief executive of DocX admitted to her role in a fraud scheme that duped servicers and relied on forged signatures and employees that could sign thousands of mortgage-related instruments a day. Lorraine Brown pled guilty to charges from the Department of Justice of conspiracy to commit mail and wire fraud. “She was responsible for more than a million fraudulent documents entering the system, directing company employees to forge and falsify documents relied on by property recorders ...

The conforming mortgage market continued to dominate new loan originations during the third quarter of 2012, accounting for a whopping 85.7 percent of the period’s robust $475 billion in new originations, according to a new Inside Mortgage Finance analysis and ranking. The conforming market – which includes loans with government insurance and conventional mortgages up to the eligible loan limit for Fannie Mae and Freddie Mac – represented 84.5 percent of new originations in 2011. During 2010, the conforming market accounted for a record 90.1 percent of new loan production. The jumbo sector made...[Includes two data charts]

Federal Reserve Chairman Ben Bernanke late last week reiterated his view that tight underwriting standards set by lenders are hindering a broader recovery of the housing market. Lenders, meanwhile, cite concerns with repurchases and regulatory uncertainty. Bernanke noted that low home prices and historically low interest rates have not prompted the “powerful housing recovery” that has typically occurred in the past after housing problems. “Unfortunately, while some tightening of the terms of mortgage credit was certainly an appropriate response to the earlier excesses, the pendulum appears to have swung too far, restraining the pace of recovery in the housing sector,” he said. More than half of the lenders that responded to the Fed’s senior loan officer opinion survey earlier this year said...

The recent actuarial report that showed the FHA’s insurance fund is underwater to the tune of $16.3 billion ought to sound an alarm for policymakers to refocus the agency on its original public mission, some leading policy experts say, and perhaps even motivate them to resolve Fannie Mae and Freddie Mac while they’re at it. “I think FHA’s financial condition is extremely precarious – much worse than FHA and HUD are making it out to be,” said long-time critic Edward Pinto, a resident fellow at the American Enterprise Institute, a conservative think tank in Washington, DC, and a former official at Fannie Mae. As he sees it, today’s very low interest rate environment means the economic value of FHA’s forward mortgage fund really is a far worse at a negative $31 billion. “And when you throw in the negative on the reverse [mortgage] program, you get close to $35 billion.” Compounding the problem is...

The CFPB and the Federal Trade Commission last week issued warning letters to approximately a dozen nonbank mortgage lenders and brokers about potentially misleading advertisements geared towards military veterans and older Americans that could be in violation of the 2011 Mortgage Acts and Practices Advertising Rule. The so-called MAP rule prohibits misleading claims concerning government affiliation, interest rates, fees, costs, payments associated with the loan, and the amount of cash or credit available to the...

In what may prove to be the first of many announcements dealing with the January 2013 mandate for changes under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has decided to give the mortgage lending industry extra time to implement certain new required consumer disclosures. Per the CFPB’s announcement in a new final rule, mortgage lenders will not be required to provide those disclosures until after the bureau’s other previously proposed mortgage disclosure rules are finalized...

Mortgage lenders say they support the CFPB’s overall effort to integrate and simplify the consumer disclosures required under the Truth in Lending Act and the Real Estate Settlement Procedures Act, but they’re also urging the bureau to proceed at a more deliberate pace when it comes to implementing such integration. In a public comment letter to the bureau, the Mortgage Bankers Association made three overarching points, the first of which is that the agency should continue to focus its energy on the enormous job of...

The CFPB has won a preliminary injunction in its first enforcement action, which was taken against a California attorney and some of his affiliated companies and partners that offered loan modification and foreclosure relief services to homeowners struggling to keep up with their mortgage payments. In Consumer Financial Protection Bureau v. Chance Gordon, et al., filed in July in U.S. District Court for the Central District of California, the judge enjoined the defendants from making various representations alleged by the...

In a move that caught most industry observers by surprise, CFPB Deputy Director Raj Date, widely seen as a possible successor to Director Richard Cordray, has decided he will leave the agency at the end of January, with no immediate plans other than to spend more time with his family. “The timing of his departure will enable Date to help finalize several new mortgage rules this January,” according to one industry trade group source. That would include the qualified mortgage rule, according to attorney Jeffrey Jamison, an...