The Department of Veterans Affairs is seeking clearance for two information-collection forms that are crucial to a veteran’s ability to obtain or cure a VA-guaranteed mortgage loan. The Office of Management and Budget is currently reviewing the forms. The VA also has published notices in the June 1 Federal Register seeking public comment on the proposed revised forms. Comments for both notices are due July 3, 2017. The first form relates to information a veteran must provide to be exempted from paying a funding fee. Borrowers are required to pay a funding fee to obtain a loan with a VA guaranty, unless the borrower is a disabled veteran receiving VA compensation for his or her service-connected disability. Loans made to unmarried surviving spouses of veterans who have died in service or from a service-related disability also are exempted from payment of the funding fee (regardless of whether the ...

Ginnie Mae is sailing without a captain, a fact that is causing some concern among mortgage bankers and mortgage-backed securities investors. The agency tasked with securitizing government-backed mortgages has been without a president since Democrat Ted Tozer left on Jan. 20, 2017, the same day that President-elect Donald Trump was sworn in as the 45th president of the United States. Since that time, Nancy Corsiglia, a career Ginnie official, has been acting president. She was elevated from her position as chief operating officer. Industry officials who claim to have knowledge of the selection process maintain that mortgage banke David Kittle, president of the Mortgage Collaborative, is the leading candidate to fill the post with Michael Bright, a director at the Milken Institute, a close second. One source close to the situation claimed that background checks by the Trump White House are likely ...

A number of lawsuits involving Fannie Mae and Freddie Mac shareholders remain unresolved and a new one just hit the court system last week. Three shareholders filed a lawsuit in the U.S. District Court for the Western District of Michigan arguing that the court should vacate the third amendment to the preferred stock purchase agreement and declare the structure of the Federal Housing Finance Agency unconstitutional. The plaintiffs also asked...

Trustees for 244 residential MBS trusts have accepted a $2.4 billion settlement offer from Lehman Brothers to resolve repurchase claims related to pre-crisis RMBS transactions that went bad. The trustees filed a notice of acceptance and a motion seeking bankruptcy court approval of the settlement on May 22. A hearing on the motion will be heard by Judge Shelley Chapman of the U.S. Bankruptcy Court for the Southern District of New York on July 6, 2017. The trustees in the settlement include...

Ocwen Financial recently filed a lawsuit against Fidelity Information Services, which completed a two-year review of Ocwen as part of an order by the California Department of Business Oversight. Ocwen alleged that FIS submitted false, fraudulent and improper invoices for the review, including invoices from strip clubs and casinos. FIS has disputed the allegations. The Structured Finance Industry Group is...

An industry trade group is requesting that the Consumer Financial Protection Bureau exclude reverse mortgages from the income-reporting requirement of the Home Mortgage Disclosure Act.The National Reverse Mortgage Lenders Association is seeking an exemption similar to the HMDA exemptions for rate spread; Home Ownership and Equity Protection Act status; origination charges; discount points; lender credits; total loan costs; points and fees; prepayment penalty term; and balloon payments. However, should the CFPB require income reporting on reverse mortgages, the NRMLA would want further guidance and clarification. Home Equity Conversion Mortgage loans make up over 99 percent of the reverse mortgage market today, and have not dropped below 85 percent since 1993, according to the group. NRMLA’s request is part of a broader comment on ...

The American Bankers Association’s letter to Secretary Treasury Steve Mnuchin also detailed a handful of key changes it said the CFPB should make to its controversial Truth-in-Lending Act/Real Estate Settlement Procedures Act Integrated Disclosure (TRID) rule. First, the bureau ought to revise the TRID tolerances. Currently, the rule requires creditors to observe closing cost tolerances that prohibit fees from increasing beyond initial disclosures by specific amounts. “TRID’s cost tolerance system is extremely convoluted, operating under a three-prong tolerance system that contains uncertain exemptions and rules for corrections,” the trade group said. “ABA believes that the current tolerance system should be entirely eliminated and replaced with a single tolerance standard of 10 percent, with more focused applicability.”Under this proposal, a ...

Oral arguments in PHH Corp. et al. v CFPB were recently held by the U.S. Court of Appeals for the District of Columbia Circuit, and reactions to the proceedings were all over the map, suggesting to some that the event functioned like a legal Rorschach test. FBR Capital Markets & Co. analyst Edward Mills said in a client note he thinks the case is bound for the U.S. Supreme Court, probably sometime next year. “Given the makeup of the en banc panel [mostly Democrat appointees], we would give a bias to the previous ruling to be overturned,” Mills said. “Despite the headlines from the ruling, we fully expect that either party will appeal the case to the Supreme Court, which ...

Fannie DUS Provides Additional Data for Multifamily. Fannie Mae announced the creation of DUS Disclose, a new MBS disclosure website that will enhance the transparency and increase the data available for multifamily securities in alignment with the industry. The new platform will replace the existing Multifamily Securities Locator Service and is expected to be available in the fourth quarter of 2017. Fannie Headquarters to Morph into High-End Grocer. As Fannie Mae prepares to vacate its iconic headquarters with a move to downtown Washington in 2018, plans are coming along for the soon-to-be former site of the GSE. Roadside Development announced...

A Manhattan appeals court raised the burden of proof for Ambac Assurance, which seeks to recover monetary damages from Bank of America in an insurance case involving $1.68 billion in securities backed by high-risk mortgages from now-defunct Countrywide Home Loans. Attorneys with Shepherd Smith Edwards & Kantas said a panel of the Appellate Division, First Judicial Department, ruled that Ambac may not use New York insurance law as the sole basis for arguing that it does not have to prove certain elements of fraud in its claims against BofA. The court also barred Ambac from using the statute to recover damages. The court held...