Ohio. The state Attorney General’s office recently finalized amendments to the state’s ability-to-repay rules that provide a safe harbor for certain types of mortgages. Under the new rules, a borrower is deemed to have an ability to repay and a reasonable probability of payment if the lender provides a fully-amortizing fixed-rate refinance mortgage that has the same or a lesser interest rate or principal amount than the current loan, and does not lengthen the payoff date. Pennsylvania. The state Department...

A federal district court judge in Washington DC this week signed off on the proposed $25 billion settlement agreement between the federal government, state attorneys general and the top five mortgage servicers, putting in place a potential template for national standards for the mortgage servicing industry. On April 6, Judge Rosemary Collyer of the U.S. District Court for the District of Columbia entered the proposed consent judgments against Bank of America, Citigroup, Wells Fargo, JPMorgan Chase and Ally Financial, including a settlement term sheet and additional exhibits specific...

Iowa Attorney General Tom Miller, the lead official behind the recent $25 billion mortgage servicing settlement, told industry representatives last week that, unlike past agreements, the AGs are going to be sticklers for full and proper implementation this time around. Implementation “is a very, very important aspect to our effort currently and going forward,” Miller said to participants in a webinar sponsored by Inside Mortgage Finance, an affiliated publication. “We put just an awful lot into this investigation and negotiations, and we don’t want it to ...

Indiana. House Bill 1238 allows a mortgage creditor to petition to have a state court determine whether a property is abandoned, and lays out the criteria and procedures for the court to use in making its determination. Also, Senate Bill 298 stipulates that if a mortgage or vendor's lien does not show the due date of the last installment, the mortgage or lien expires 10 years after the date of execution of the mortgage or lien, not 20 years as had been the case previously. The measure provides an exception if a foreclosure action is brought prior to the expiration...

Concern among non-agency MBS investors over principal reductions that will occur under the multistate foreclosure settlement “is much greater than the reality,” said Iowa Attorney General Tom Miller, who played a pivotal role in those negotiations. During a webinar sponsored by Inside Mortgage Finance this week, Miller said that the $25 billion settlement includes protections for MBS investors. He said that negotiators met with MBS investors during the drawn-out process of reaching a settlement with the five largest servicers. The Association of Mortgage Investors has complained that investors...

Banks will receive some release from liability for loan originations in the $25 billion mortgage settlement involving the industry’s five largest servicers, state attorneys general and the federal government, according to experts participating in an Inside Mortgage Finance webinar this week. While the settlement is often described as “landmark,” industry experts note that major components were drawn from a hodgepodge of federal and state initiatives. The detailed servicing standards, for example, are a “synthesized cut-and-paste” from sources including Office of the Comptroller of the Currency...

The settlements reached by five major mortgage servicers with a handful of states over their use of the Mortgage Electronic Registration System has not weakened the legal position of MERSCorp itself, according to industry experts. The new agreements signed by New York Attorney General Eric Schneiderman with Wells Fargo, Bank of America, JPMorgan Chase, Citigroup and Ally Financial has the banks paying a total of $25 million to the state in exchange for a release of further claims regarding the banks’ use of MERS throughout the servicing and foreclosure process and a pledge not to challenge...

The documents governing a proposed $25.0 billion settlement involving five major banks include greater incentives for principal reduction loan modifications on portfolio loans rather than loans in non-agency mortgage-backed securities. However, non-agency MBS investors remain concerned that they could take losses due to the settlement. The consent judgments against Ally Financial, Bank of America, Citigroup, JPMorgan Chase and Wells Fargo were filed in federal court this week, a month after the settlement was announced by 49 state attorneys general and the federal government ...

Origination of FHA-insured mortgage loans exceeding $417,000 were concentrated mostly in five states in 2011 even as jumbo loan production dropped further on both monthly and year-to-year bases, according to Inside FHA Lending’s analysis of the latest FHA data. California, New York, Virginia, New Jersey and Maryland accounted for 85.7 percent of the FHA jumbo market in 2011, with lenders reporting $18.2 billion in total originations, down 34.9 percent from 2010 and 2.5 percent from the third to the fourth quarter. California led all states in 2011 in FHA jumbo origination ($8.73 billion) and market share (48.0 percent). Production on a quarterly basis was ... [Two charts]

Industry experts digging through thousands of pages of legal documents associated with the $25 billion foreclosure settlement agreed to by five major servicers mostly found what they expected: a complex package of mixed forms of borrower support that the banks are expected to implement sooner rather than later. The settlements involving Bank of America, Wells Fargo, JPMorgan Chase, Citigroup and Ally Financial and 49 state attorneys general will have to be approved by the U.S. District Court in Washington, DC. Although critics found grounds for complaint about the varying incentives for loan modification and...