Bexil American Mortgage, a newly formed originator, plans to originate non-agency mortgages and sell them to Citi, Wells Fargo and PennyMac. John Robbins, president of Bexil American Mortgage, said the stagnant non-agency securitization market has not completely stopped sales of jumbo mortgages. “There are active investors for those products today,” he said last week on a call with investors. ...

In a somewhat unusual announcement last week, Walter Investment Management said it was servicing approximately 910,000 loans representing approximately $59.0 billion of unpaid principal balance as of the end of the third quarter of 2011. The announcement was unusual because that was the extent of the statement. “We believe the major increase in the servicing portfolio could be due to Walter being allocated a portion of the servicing rights related to the Fannie Mae/Bank of America deal, whereby Bank of America sold the servicing rights to 400,000 loans to Fannie Mae,” said analysts at FBR Capital Markets. ...

More people than expected showed up at the Mortgage Bankers Association annual convention this week in Chicago – including intermittent Occupy protestors – given the hugely uncertain prospects facing the industry. MBA economists are predicting less than $1 trillion in new originations in 2012, which would be the lowest new production volume since 1997, and all three major components in the business – origination, servicing and secondary marketing – face huge structural challenges that so far are still just vaguely mapped out. Yet attendance was up about 18 percent from last year, and several observers noted that investors are...

A scathing criticism of the way the Federal Housing Finance Agency and Freddie Mac handled a $1.35 billion settlement with Bank of America could cause the regulator and the government-sponsored enterprises to tighten repurchase enforcement – and consequently inflate the buyback problem, according to litigation experts. Speaking on a recent webinar hosted by Inside Mortgage Finance, experts said a report by the FHFA’s Office of the Inspector General which found flaws in the BofA settlement approval process, could push the GSEs and their regulator to lean harder on major lenders to repurchase “bad loans.” This, in turn, could...

Mortgage banking activity was one bright spot in an otherwise lackluster earnings period, according to a third quarter review by analysts at FBR Capital Markets. “Activity was up 35 percent from 2Q11 as we saw lower interest rates drive another refinance boom, whereby refinances accounted for almost 80 percent of all originations,” FBR said. The analysts expect originations and gain-on-sale margins to be up significantly from 2Q11 due to the persistent decline of mortgage rates through the quarter. “We continue to recommend investors stick with banks that have sizable mortgage banking operations because refinance levels should stay elevated from low interest rates, and some large players have exited the business, which should bode well for gain-on-sale margins,” the FBR team said.

Transparency, investor access to information and a willingness to engage in loss mitigation can help reduce the wave of litigation and investor losses resulting from repurchase demands, according to mortgage litigation experts. There’s a better alternative to fighting out buyback claims in court: all counterparties should sit down and find ways to resolve issues that trigger repurchase claims in an open and forthright manner, said panelists on a webinar hosted by Inside Mortgage Finance Publications. “We have to work together because the country is hurting and the longer this drags on, the bigger the problem is going...

The U.S. Department of Labor’s Occupational Safety and Health Administration has ordered Bank of America to rehire a Countrywide Financial Corp. employee who led internal investigations that revealed “widespread and pervasive wire, mail and bank fraud involving Countrywide employees” and was later dismissed. The employee alleged that those who attempted to report fraud to Countrywide’s employee relations department suffered persistent retaliation. The employee was fired shortly after Countrywide’s acquisition by BofA.

Mortgage investing firm MountainView Capital Holdings partnered with Statebridge Company, an “investor-focused” servicer, to win an auction of loans sold by the Federal Deposit Insurance Corp. last week. Together, the firms won a 40.0 percent interest in a $282.0 million portfolio of residential mortgages from 48 failed banks. Statebridge will service the mortgages and Geneva House, an affiliate of Statebridge, was a minority investor in the deal. Officials with the firms counted the auction win as a major achievement – neither had won any previous structured transaction risk-sharing auctions by the FDIC. ...

Kinecta Federal Credit Union launched a new asset utilization loan program for jumbo mortgages last week, continuing the trend of innovative offerings from credit unions. The program allows borrowers with high net worth and significant liquid assets, including self-employed and retired borrowers, to use a percentage of their assets as income for qualifying purposes. ... [includes three briefs]

The reverse mortgage arena experienced another shake-up as SunTrust Bank, citing poor volume, quite the business even as J.G. Wentworth, the largest purchaser of future payment products, announced its entry into the market. Atlanta-based SunTrust stopped accepting new reverse mortgage applications as of Sept. 1, although it is continuing to process applications already in the pipeline. A statement from the bank indicated that low production volume was the reason for management’s decision to leave the reverse mortgage business and to focus resources instead on mortgage origination and servicing. The market also lost ...