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Inside Nonconforming Markets

February 19, 2010

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Subprime Loss Mitigation Increases, Servicers’ Tactics Vary as Delinquencies Pile Up

Subprime servicers continued to focus on loss mitigation in 2009 while servicing volume declined for the vast majority of the industry, according to a new ranking and analysis by Inside B&C Lending. An estimated $697 billion in subprime mortgages were outstanding at the end of 2009, up 4.8 percent from the previous quarter due to a technicality... [Includes one chart] Read More

Ocwen, SPS Lead Non-Prime HAMP Activity

In terms of permanent modifications per eligible borrowers, Ocwen Financial Corp. and Select Portfolio Servicing led all non-prime servicers as of the end of January, according to a new Inside B&C Lending ranking and analysis. The Treasury Department this week released the latest data on the Home... [Includes one chart] Read More

Senate Remains Divided on Proposed CFPA

The proposed Consumer Financial Protection Agency is at the center of the Senate’s debate on financial reform legislation. Increased consumer protection provisions including non-prime mortgage regulation are likely to be included in the bill considered by the Senate, but Democrats and Republicans disagree on the scope of the CFPA. Last week, Sen. Chris Dodd, D-CT, agreed to work with Sen. Bob Corker, R-TN... Read More

State HFAs Offer Fannie’s ‘Advantage’ Mortgage

A number of state Housing Finance Agencies will soon offer low-downpayment mortgages to first-time homebuyers via Fannie Mae’s Affordable Advantage product. Last week, the Wisconsin Housing and Economic Development Authority said it will launch its program March 1, making it the first HFA to offer the new product. Eligible state Housing Finance Agencies can deliver Affordable Advantage... Read More

Re-Default Rates Low on IndyMac’s FDIC Mods

The re-default rate on IndyMac mortgages modified under a program designed by the Federal Deposit Insurance Corp. is significantly lower than the industry’s overall re-default rate. The IndyMac experience also offers insight into the Home Affordable Modification Program, which was based on the FDIC’s program. Of the 23,161 IndyMac mods completed... [Includes one graph] Read More

Loss Mit Efforts Subject to Debt Collection Laws

Prosecution of servicers’ loss mitigation efforts under the Fair Debt Collection Practices Act is a growing concern, according to lawyers at the law firm of K&L Gates. While the law contains exclusions for some servicers, it is increasingly being applied to private-label loan modification companies. The FDCPA generally applies to third-party debt collectors. During an audio conference... Read More

Citi Pilots Unique Deed-In-Lieu Program

CitiMortgage is testing a program to allow distressed borrowers to stay in their homes for six months by agreeing to sign over their property deeds to the servicer. Citi announced the program last week in advance of widespread implementation of the Home Affordable Modification Program’s short sale and deed-in-lieu components. Citi’s Foreclosure Alternatives Program will provide borrowers... Read More

News Briefs

Select Portfolio Servicing was the highest bidder for the $11 billion portfolio of jumbo mortgages held... Refinancing borrowers overwhelmingly chose fixed-rate mortgages in the fourth quarter of 2009, according... The Federal Housing Finance Agency proposed new housing goals for Fannie Mae and Freddie Mac this week... Read More

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