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Inside Mortgage Finance

June 16, 2006

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Bush Administration Flexes GSE Regulatory Muscle, Promises Closer Scrutiny of Fannie and Freddie

The Bush administration turned up the heat this week on Fannie Mae and Freddie Mac by announcing separate “reviews” of the government-sponsored enterprises’ non-mortgage investments and the government’s traffic-control processes for approving GSE debt issues. Coming on the heels of Fannie Mae’s recent $400 million settlement agreement with federal regulators, the new GSE regulatory initiatives were seen as stimulants to prod a stalled legislative process to create a new government regulatory apparatus for Fannie, Freddie… Read More

Closed-End Seconds Help Home-Equity Production to Solid Gains in Early 2006

A surge in closed-end second mortgage lending helped propel a rebound on home-equity lending during the first quarter of 2006, according to a new analysis by Inside Mortgage Finance. Revised data show a solid $100 billion of home-equity loan originations during the first three months of this year. While most of that origination volume was in new lending on revolving home-equity lines of credit – an estimated $62.5 billion during the first quarter – the… [One data table included] Read More

Despite Clarifications, Disputes Still Rage Over Loan Originator Wages and Overtime

Disputes over loan officer compensation continue to plague the mortgage industry and may be spreading despite the federal government’s recent efforts to clarify the rules. Three former Washington Mutual loan officers filed the most recent complaint in New York federal court. The “home loan consultants” had worked at three WaMu offices and claimed the company denied them wages for work done on loans if those loans did not close. … Read More

Fed HOEPA Hearing Underscores Importance of Consumer Understanding of Process, Products and Role of Brokers

Consumer education, financial literacy and clarification of the role of mortgage brokers are emerging as the leading defenses against lending abuses, but regulators can do more to protect consumers against bad lending practices and bad financial decisions, according to panelists during a public hearing hosted by the Federal Reserve Bank of Philadelphia last week. … Read More

Much Bluster, But Little Action, Surround Capitol Hill Hearing on HMDA Pricing Data

Are federal regulators and mortgage industry officials doing enough to ferret out discrimination in the mortgage market and punish – and make examples of – the offending lenders? House Democrats don’t think so. “I do not see on the part of the financial services industry or the regulators the kind of urgency that many of us here feel on this issue,” said Rep. Barney Frank, D-MA, in remarks at a hearing this week on price… Read More

Servicing Transfer Market Remains Subdued In Early 2006, Most Action in Freddie Deals

The secondary market in mortgage servicing rights remained sluggish in early 2006, according to data from Ginnie Mae and the government-sponsored enterprises. Mortgage servicing rights with an outstanding balance of $59.5 billion associated with agency mortgage securities were transferred from one company to another during the first three months of 2006. That was up from a low of $34.5 billion during the final three months of last year, but it represented just 1.4 percent of… [One data table included] Read More

State Regulators Tap Securities Industry Watchdog to Create Nationwide Uniform Licensing, Tracking System

The National Association of Securities Dealers has agreed to lend its expertise in building a nationwide licensing and database system to simplify state mortgage registration and licensing and make it easier to track lending miscreants as they move through the mortgage financing system. The NASD signed a contract June 9 to develop a system akin to the Central Registration Depository and the Investment Adviser Registration Depository used by the securities industry to register, license and… Read More

Multiple Loan Submissions by Mortgage Brokers A Significant Problem for Wholesalers, Study Finds

A significant number of mortgage brokers appear to routinely submit loan applications for the same borrower to multiple wholesale lenders, according to a new nationwide study of brokers. And the practice is likely costing many wholesalers millions of dollars a year in unnecessary – and uncompensated – underwriting expenses. … Read More

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