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Inside Mortgage Finance

March 26, 2009

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Toxic Asset Clean Up Plan Finally Announced, Implementation Expected to be Key to Success

The Obama administration’s long-awaited blueprint for helping banks dump “toxic” assets from their portfolios so they can fire up their lending programs met with widespread enthusiasm this week, but observers say the impact of the program still hinges on pricing and other technical issues. “While attractive from a macro perspective, the implementation will... [Includes one chart and one graph] Read More

Industry Experts Applaud White House Choice of Mortgage Veteran to Head FHA

Industry experts across the board are praising the Obama administration for tapping David Stevens as the next FHA commissioner and assistant secretary of housing at the Department of Housing and Urban Development. Stevens, an industry veteran with experience in all aspects of mortgage finance from loan origination to securitization, will be the first FHA chief in recent years... Read More

Fed Expands TALF to Include Servicing Advances, Ease Burden on Some Lenders

The Federal Reserve Board late last week expanded the eligible collateral for loans extended by its Term Asset-Backed Securities Loan Facility to include mortgage servicing advances. Managed through the New York Federal Reserve Bank, TALF doles out three-year financing for investors buying newly issued, AAA-rated securities. It was originally designed for deals collateralized... Read More

FTC to Use New Rulemaking Authority to Protect Consumers Against Modification, Foreclosure Scams

The Federal Trade Commission will soon begin drafting new rules prohibiting unfair and deceptive mortgage lending acts and practices under new rulemaking authority granted recently by Congress. The FTC expects to use its expanded rulemaking powers to protect consumers against mortgage servicing practices and scams involving loan modifications and foreclosure rescue, and to address... Read More

Congress Weighs Proposals to Curb Executive Bonuses, Set Wage Controls for TARP-Assisted Institutions

The national firestorm over the payment of bonuses to executives at AIG seems to have eased in the last few days, reducing the threat of punitive Congressional or regulatory action against the executive compensation practices and standards of mortgage lenders and the government-sponsored enterprises, among others. The House last week rushed through legislation that would impose a 90 percent tax... Read More

Obama Modification Initiative Meets Some Industry Skepticism, but Viewed as Best Program to Date

Industry experts gave their vote of confidence to the Obama administration’s Making Home Affordable plan in testimony last week on Capitol Hill last week but also noted that the program’s shortfalls may hinder its ability to be as effective as originally estimated. The Obama plan has two prongs. A standardized modification framework, the Home Affordable Modification, pays incentives to servicers and... Read More

‘Mixed Signals’ Don’t Help Industry Trying To Find Prudent Lending Balance in 2009

Lax regulatory oversight is widely blamed for contributing to the collapse of the housing and mortgage markets, but some say the pendulum has swung too far the other way and that the government is sending “mixed signals” that are weighing down on a potential recovery. “In response to these challenging circumstances, banks are clearly taking more care in evaluating applications... Read More

Bank of America Ranks as Top Home-Equity Lender as HELOC Business Keeps Growing

Home-equity lending declined in 2008 – along with every other part of the mortgage market that lacks have strong government backing – but lenders continued to grow their portfolios of revolving credit secured by the borrower’s home. Banks and thrifts held some $667.5 billion of home-equity lines of credit in their portfolios at the end of 2008, up 9 percent... [Includes one chart] Read More

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