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Inside Mortgage Finance

March 24, 2006

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Industry Turns from RESPA Rulemaking to New Trends in Bundling, ABAs, Tougher Enforcement

Industry enthusiasm for reforming outdated federal rules governing the mortgage settlement process appears to be waning. Instead, lenders and settlement service providers are increasingly shifting their attention from possible rulemaking to the new world of bundled closing services, alliances, improved technology, “guaranteed” good-faith estimates, and tougher enforcement of the Real Estate Settlement Procedures Act. … Read More

Gulf Coast Havoc Helps Drive Mortgage Delinquencies Higher in 4th Quarter, But They Were Headed Up Anyway

Mortgage delinquency rates jumped higher in the fourth quarter because of a variety of factors, not the least of which was the economic upheaval caused by severe hurricanes in the Gulf Coast. Large mortgage servicers reported a weighted-average overall delinquency rate of 3.52 percent as of the end of last year, according to the Inside Mortgage Finance quarterly lender survey. That was up 27 basis points from the average 3.25 percent rate reported in the… [One data table included] Read More

Flood Insurance, Data Security Bills Advance As Measures Now Await Full House Action

Mortgage lenders could face increased fines for borrowers who do not purchase mandatory flood insurance and, separately, consumers would be able to freeze their credit reports if bills recently marked-up by a House committee are enacted. Last week the House Committee on Financial Services approved H.R. 4973, the Flood Insurance Reform and Modernization Act, as well as H.R. 3997, the Financial Data Protection Act. Both measures, which await votes by the full House, have far-reaching… Read More

Freddie Looks to Increase Presence In Nontraditional Mortgage Markets

Freddie Mac, looking to build on the overall market share gains it posted last year, is now taking aim at significantly increasing its business in nontraditional mortgage products. But whether the government-sponsored-enterprise can successfully compete in a market dominated by subprime and so-called Alternative A products remains to be seen. … Read More

Trump Enters Residential Mortgage Market, Pledges to Reinvent the Way Business is Done

One of the richest men in America has set his sights on the residential mortgage market, launching a new origination shop that officials say will change the way the industry operates. “We plan on leading an industry that we believe is in need of some leadership,” said E.J. Ridings, president and CEO of Trump Mortgage, a venture created by billionaire entrepreneur and real estate tycoon Donald Trump. … Read More

FTC Asks Court to Rethink Decision on Adverse Action Notices for High Mortgage Insurance Prices

The Federal Trade Commission has added its weight to a lawsuit that alleges that private mortgage insurer Radian Guaranty violated the Fair Credit Reporting Act by failing to provide adverse action notices when borrowers pay high insurance premiums based on their credit history. At issue is a court decision in Whitfield et. al. v Radian, a case that grew out of the decision by plaintiffs Whitney and Celeste Whitfield to take a mortgage from… Read More

New HUD Study Highlights Overlaps, Opportunities in the Mortgage Market

The overlap between mortgage borrowers served by FHA and those served by Fannie Mae and Freddie Mac appears to be relatively small, according to a new study released by the Department of Housing and Urban Development last week. Nevertheless, the analysis suggests there may be some opportunities for both the FHA and the government-sponsored enterprises when it comes to expanding their activities. … Read More

New FASB Rule Allows Derivatives Users to Elect Fair Value Measure for MSRs, Loans Held for Sale

Mortgage servicers and other holders of servicing rights now have the option to choose fair value to recognize and measure current holdings of servicing assets and liabilities, eliminating the need to comply with complex hedge accounting rules. The change was brought about by a new standard, Statement of Financial Accounting Standard 156, which the Financial Accounting Standards Board issued just this week in an effort to simplify the accounting for servicing assets and liabilities. The… Read More

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