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MortgageChronicle.com Archives
December, 2011
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Biggest Mortgage News of 2011
Mortgage lawsuits, executive compensation and actions against government mortgage lenders were all subjects that were among Mortgage Daily's 10-biggest stories of 2011.
The loan originator compensation rule was the topic of three of last year's blockbuster articles.
But it was a story about top-selling loan originators that grabbed the most attention.
Mortgage Market Index Tumbles to Record Low
The Mortgage Market Index was 131 for the week ended Dec. 30.
The index has not been this low at any point since it was launched by Mortech Inc. and MortgageDaily.com in late 2009.
Inquiries for adjustable-rate mortgages sank 36 percent from last week, the biggest drop of any category.
Mixed Month for M.I. Activity
Mortgage insurers wrote 5 percent fewer mortgage insurance policies in November than in October.
But the dollar-volume of M.I. business was 10 percent higher.
The number of defaults, meanwhile, deteriorated by 5 percent in the most recent month.
Fannie Loans Outperform Market as New Business Jumps
Secondary activity at the Federal National Mortgage Association grew 18 percent between October and November.
Fannie Mae's residential delinquency of at least three months has not increased since February 2010.
The performance contrasts data reported by Freddie Mac and Standard & Poor's and Experian that 90-day delinquency has increased for three consecutive months.
Ohio a Mortgage Hub for Chase
One of the biggest mortgage operations at JPMorgan Chase & Co. is in the Columbus, Ohio, area.
The region is home to 7,000 Chase mortgage employees.
This year, nearly 2,000 positions were filled by Chase in Central Ohio, including hundreds of mortgage jobs.
Rates Rise But Could See Saw
The average 30-year fixed-rate mortgage was 4 basis points higher this week.
The 15-year mortgaegs was up 3 BPS.
But rates have some room to decline and could be down around 7 BPS by the next set of reports based on an analysis of Treasury market activity.
M.I. Claims Disputed in Court
Three insurance companies have been dismissed from a lawsuit filed by Fannie Mae.
A complaint filed by Bank of America, N.A., alleges that Old Republic Insurance Co. has denied hundreds of millions of dollars in valid mortgage insurance claims "based on unreasonable interpretations of the language contained in the standard mortgage insurance policy."
After 1,400 mortgage insurance claims were denied between 2006 and 2008, Countrywide Home Loans Inc. sued Mortgage Guaranty Insurance Corp.
Hawaii, Capitol Region Command Highest Loan Amounts
Hawaii's average loan amount for all of 2011 was more than any other state.
No. 2 was Washington, D.C.
Also among the top-five states was Maryland, which is located within commuting distance of the nation's capitol.
G-Fee Increase Announced
Federal legislation enacted earlier this month requires that guarantee fees charged by Fannie Mae and Freddie Mac be increased.
At a minimum, g-fees in 2012 need to be at least 10 basis points higher than average fees in 2011.
G-fees could be increased again.
Lenders Lose in Many Recent Foreclosure Decisions
The Court of Appeals of Ohio, Ninth District, overturned a summary foreclosure judgment in favor of Wells Fargo Bank, N.A., because the bank failed to prove it provided a notice of default.
In Florida, the Fourth District Court of Appeal reversed a foreclosure judgment in favor of Wells Fargo Mortgage Bank, N.A.
The District Court of Appeal of Florida, Fourth District, overturned a foreclosure by JP Morgan Chase Bank, N.A.
Anti-Flipping Waiver Extended
A New York judge has fined HSBC Bank USA for frivolous conduct in pursuing a foreclosure with faulty paperwork.
The judge alleges that HSBC used robo-signers and false statements in the foreclosure of Ellen N. Taher's property, and he dismissed the action in July.
But HSBC says it is only the trustee on the loan, which is serviced by Ocwen Loan Servicing.
HSBC Fined for Robo-Signing
A New York judge has fined HSBC Bank USA for frivolous conduct in pursuing a foreclosure with faulty paperwork.
The judge alleges that HSBC used robo-signers and false statements in the foreclosure of Ellen N. Taher's property, and he dismissed the action in July.
But HSBC says it is only the trustee on the loan, which is serviced by Ocwen Loan Servicing.
Former Mortgage Titan's House for Sale
Angelo Mozilo was the founder of Countrywide Financial Corp., which grew to become the biggest residential lender in the country.
A California property that he has listed as his residence is up for sale.
The five-bedroom, six-bathroom house sits on a golf course and is listed for $3.4 million.
CMBS Performance Improves
The rate of 30-day delinquency on securitized commercial real estate loans was down 16 basis points between October and November.
The foreclosure rate was nominally higher, and real-estate-owned filing were up 7 BPS.
But a 75-basis-point improvement in the 90-day category offset the deterioration in the foreclosure and REO categories.
Lenders Defend Title to Mortgages
The Court of Appeals of California unanimously decided in favor of Avelo Mortgage in a lawsuit alleging that the Mortgage Electronic Registration Systems Inc. was not a true beneficiary and could not assign its interest in the deed of trust to Avelo Mortgage.
A final summary judgment of foreclosure in favor of U.S. Bank, N.A., as trustee of Mastr Adjustable Rate Mortgages Trust 2007-3, was reversed by the District Court of Appeal of Florida, Second District.
The dismissal of a complaint filed by River City Mortgage & Financial LLC in a Minnesota district court against New Millennium Title Group LLC, Frank Griebenow and Debra Stark was reversed and remanded by the Court of Appeals of Minnesota.
FHA Delinquency Higher for 5 Consecutive Months
The U.S. government has insured more than 1.0 million mortgages so far this year for $190 billion.
But the milestone was overshadowed by deteriorating performance on government loans -- with serious delinquency up each of the past five months cumulatively by around 110 basis points.
An 8 percent decline in new government financing for home purchases was offset by a 16 percent rise in refinance activity.
Federal Agencies Busy Pursuing Investor Litigation
According to the U.S. Attorneys Office for the Northern District of California, Cedar Funding Founder David A. Nilsen pled guilty on Oct. 24 to federal charges that he deceived investors.
A settlement with former directors and officers of Washington Mutual Bank was announced on Dec. 15 by the Federal Deposit Insurance Corp., which originally filed its lawsuit on March 16 in U.S. District Court for the District of Washington.
The Securities and Exchange Commission obtained an emergency court order in October that froze the assets of James G. "Jay" Temme and his company, Stewardship Fund LP.
United Guaranty Relaxes Reserve Requirements
A bulletin from United Guaranty Corp. indicated that updates were made to its Performance Premium requirements.
The changes impact owner-occupied, single-family, rate-term refinance transactions.
Mortgage insurance submissions through the Performance Premium program will no longer require reserves.
Holidays Dampen Demand, Rates Bounce off Bottom
The U.S. Mortgage Market Index from Mortech Inc. and MortgageDaily.com for the week ended Dec. 23 was 193.
It was the slowest week for loan inquiries since the Thanksgiving index of 161.
The 30-year mortgage averaged fell to the lowest on record, but an analysis of market data reported by the Department of the Treasury indicates that mortgage rates could be around 12 basis points worse by the time the next report rolls around.
Freddie's Delinquency Rises 3rd Consecutive Month
Residential delinquency of at least 90 days at the Federal Home Loan Mortgage Corp. climbed 3 basis points in November from October.
Last month's rise marks three consecutive months that the delinquency rate has been worse.
Freddie Mac's rate, however, was better than the year-earlier period.
Washington Responsible for Financial Crisis
Two lawsuits filed last week by the Securities and Exchange Commission against former senior executives at Fannie Mae and Freddie Mac put the spotlight on the government's role in the financial crisis, according to a newspaper editorial that puts the duo at the heart of the financial crisis.
A government effort started in 1992 to increase home ownership for lower-income borrowers had the two secondary lenders steadily cutting lending standards and buying subprime and Alt-A mortgages. Subprime originators could profit while shifting the risk to Fannie and Freddie.
Rep. Barney Frank (D-Mass.) was among congressional supporters of the pair of government-sponsored enterprises who blocked reforms to address the increased risk.
Banker Portrayed as Real Life George Bailey
A banker has been portrayed in a television news show as a real-life George Bailey from the holiday film It's a Wonderful Life. His bank's use of loan modifications was highlighted in the show.
Around 8 million people reportedly watched the news show, which aired Wednesday night.
The positive portrayal of a banker is unusual in today's environment when bankers are more often held out as villains.
Record Low Rates Likely to Rise
At 3.91 percent, the average 30-year, fixed-rate mortgage was lower than ever previously recorded.
Fifteen-year and adjustable-rate mortgages also reached new lows.
But Treasury market activity points to higher rates in the next set of reports.
Senator Calls for Criminal Probe of GSE Execs
After being sued last week by the Securities and Exchange Commission, the former chief executive officers of Fannie Mae and Freddie Mac could face a criminal investigation if a U.S. senator has his way.
The SEC lawsuit was filed against six executives including former Fannie CEO Daniel Mudd and former Freddie chairman and CEO Richard Syron.
Now, Sen. Scott Brown (R-Mass.) has written a letter to SEC Commissioner Mary Schapiro calling for a criminal investigation.
Chase Hirings Hundreds in Louisiana
JPMorgan Chase & Co. plans to hire hundreds of new mortgage employees for two document management facilities in Louisiana.
One facility handles mortgage records for borrowers across the nation.
The new staff at the second facility will take documents inherited from acquisitions and digitize them as images.
Fannie Revises Requirements, Raises Fees to Sellers
Fannie Mae said it will immediately permit master or blanket insurance policies that combine insurance coverage for multiple condominiums as long as the coverage meets certain specific criteria.
The selling guide was updated to clarify that sellers can't delegate their authority to execute a note endorsement.
The Washington, D.C.-based firm is raising the cost of reviewing a lender's financial statements.
LPS Hit With Robo Signing Class Action
A Nevada lawsuit filed this week against Lender Processing Services Inc. alleges that the foreclosure process used by the Jacksonville, Fla.-based company was tainted. In addition to voiding notices of default and suspending tainted foreclosures, the lawsuit seeks unspecified actual damages, punitive damages and attorney's fees. Class-action certification is sought for potentially thousands of borrowers who faced foreclosure.
Five borrowers who are or were in the process of foreclosure filed the lawsuit in Clark County District Court.
Other defendants named in the complaint include Bank of America, IndyMac Mortgage Services and Regional Service Corp.
Huge Settlement Over Countrywide Discrimination
Alleged lending discrimination at Countrywide Financial Corp. will cost Bank of America Corp. more than $300 million.
Countrywide is accused of charging higher rates and fees to black and Latino borrowers than similarly qualified white borrowers.
BofA sought to distance itself from such alleged practices by clarifying that they occurred before it acquired Countrywide.
Some Signs of Improvement in Shadow Inventory
The inventory of distressed loans that are lurking in the shadows has declined 16 percent over the past year.
The most-recent inventory of shadow inventory would take five months to clear out.
Another report last month indicated that the total supply of distressed properties in the third-quarter would take two months less to sell than the second-quarter supply.
Overall Delinquency Down Despite Uptick in Securitized 1sts
The rate of 90-day delinquency on all home loans was 10 basis points lower in November than in October.
The decline marked the second consecutive month of improvement.
A separate report indicated that delinquency on just first mortgages included in private-label residential mortgage-backed securities climbed 9 BPS during the same period.
Subprime Servicers See Ratings Upgrades and Downgrades
The subprime mortgage servicer rating for Ocwen Financial Corp. has been downgraded.
The company's aggressive acquisition strategy was cited as a main concern.
But the subprime servicer rating for Specialized Loan Servicing LLC was increased.
CA v FNMA & FHMLC Challenges FHFA
The Federal Housing Finance Agency claims that states have no right to subpoena the Federal National Mortgage Association or the Federal Home Loan Mortgage Corp. But the state of California is challenging that notion in two lawsuits filed against the government-controlled enterprises.
The lawsuits seek to have answered 51 questions outlined in previous subpoenas to Fannie Mae and Freddie Mac that they have thus far refused to answer.
The FHFA asserts that states can't subpoena the secondary lenders because Congress sought to pre-empt such actions through the Housing and Economic Recovery Act of 2008.
Seconds Outperform First Mortgages
The rate of 90-day delinquency on first mortgages during November was 9 basis points higher than in October.
Another report on 30-day delinquency suggests that the 90-day rate could climb higher.
But on second mortgages, 90-day delinquency fell 3 BPS.
Q4 Purchase Projection Pared, Refi Forecast Expanded
U.S. originations for home purchases are expected to be $89 billion during the fourth quarter.
The projection was pared from $91 billion predicted last month.
At the same time, the outlook for refinance originations was lifted $40 billion.
Mortgage Firm, Biggest Realtor Team Sued Over HELOCs
A lawsuit filed against a real estate team that has been ranked as the biggest in the country alleges that Maryland homebuyers were convinced to purchase another home before selling their current residences -- a scheme that allegedly generated more commissions in the process. Lawyers in the case seek class action certification.
Clients of Long & Foster claim that they were advised to make home purchases in 2006 and 2007 before their old homes were sold. They were told that they could use bridge loans to finance the downpayments -- though none were actually available.
The lawsuit alleges that Long & Foster's mortgage unit, Prosperity Mortgage Co., covertly used fraudulent documents to secure home-equity lines of credit for the home buyers to use for downpayments.
WANTED: Mortgage Crooks
The former chief executive officer of failed Worldwide Financial Resources was sentenced to two years in prison for bankruptcy fraud.
A former vice president and director of failed Metropolitan Savings Bank was sentenced to six years in prison for hiding delinquent mortgages from bank regulators.
A 15-year sentence was handed down to the owner of a Tustin, Calif., hard-money lender for stealing nearly $7 million in a Ponzi scheme.
3 Republicans, 1 Dem Got VIP Loans from Countrywide
A letter sent to leaders of the House Ethics Committee outlines the findings from an investigation into Countrywide Financial Corp.'s VIP lending program.
The chairman of the House Oversight and Government Reform Committee issued the letter last week.
The investigation found that four members of the House of Representatives, including three Republicans and one Democrat, received better terms on their mortgages than were available to the general public.
Problems Ahead for 2007 CMBS, Industrial Properties
Quarterly delinquency on commercial mortgages that are secured by industrial properties reached a 22-year high.
"With industrial vacancy rates at historical highs and rents remaining stagnant or falling, we don't expect much near-term improvement," a report indicated.
Another report warned that more than half of CMBS loans originated in 2007 and scheduled to mature next year will not be able to refinance.
Hundreds of Servicing Jobs Open in Texas
A job fair is being held this week in Houston by Stewart Lender Services.
The job openings include manager, foreclosure services; manager, loss mitigation support services; and team lead.
Stewart hopes to recruit hundreds of employees by spring.
GSEs Have $2 Trillion in High-Risk Loan Exposure
The Securities and Exchange Commission last week announced two lawsuits filed against former senior executives at Fannie Mae and Freddie Mac.
The defendants are accused of hiding their exposure to higher-risk loans.
An analysis of data disclosed in the lawsuits indicates that the two own high-risk loans estimated at $2 trillion -- far more than they originally disclosed to investors.
Mortgage Bankers Lift Outlook
The forecast for fourth-quarter residential production was increased by 5 percent from last month's projection.
The prediction for first-quarter 2010 originations was raised by 14 percent.
The overall improved forecast was the result of an increased refinance outlook.
November Delinquency Deteriorates
The rate of loans in the foreclosure process tumbled 13 basis points between October and November.
But the total residential delinquency rate still climbed 9 basis points.
The deterioration was the result of a 22-basis-point increase in delinquency of at least 30 days excluding foreclosures.
2011 Bank Failures On Track for 3-Year Low
On Friday, the Florida Office of Financial Regulation took control of Premier Community Bank of the Emerald Coast.
The Office of the Comptroller of the Currency closed down Western National Bank.
At the recent pace of bank failures, the total could fall below 100 for the first time since 2008, when just 25 federally insured bank failures occurred.
NV AG Accused of Improperly Using DC Law Firms
For the third time since last year, Nevada's attorney general is being accused of inappropriately using a Washington, D.C., law firm in actions against mortgage-related companies.
Two home builders sued the state attorney general last year. They alleged that a Washington, D.C., law firm was hired in violation of their due process rights.
Now the state is accused of filing a sensational and misleading lawsuit and outsourcing the related investigation to a Washington, D.C., law firm "in apparent violation of Nevada law."
Holiday Season Slows Refis; Purchases Slump
Refinance business drifted 8 percent lower during the week ended Dec. 16 based on the U.S. Mortgage Market Index report from Mortech Inc. and MortgageDaily.com.
Purchase transactions fell 16 percent from the previous report.
Including all business, new loan inquiries fell 11 percent.
Freddie Revises Cashout, Appraisal Requirements
Approved Freddie Mac sellers were advised of new cashout guidelines for properties that were recently acquired for cash.
The secondary lender additionally updated its appraisal requirements.
Freddie covered the updates in a bulletin to approved sellers.
SEC Sues Former GSE Executives
The former chief executive officers of Fannie Mae and Freddie Mac were among executives named as defendants in a lawsuit filed by the Securities and Exchange Commission.
The defendants are accused of hiding their companies' exposure to higher-risk loans.
"Fannie Mae and Freddie Mac executives told the world that their subprime exposure was substantially smaller than it really was," the SEC said.
Florida Appeals Court Decision Called "Sea Change"
A decision by a Florida appeals court in a case involving a 2009 foreclosure case could force mortgage servicers to restart the foreclosure process on some loans depending on assignment dates. The decision was called a "sea change" in the way courts look at foreclosure cases.
At issue is a mortgage assignment that was dated three days after the foreclosure was originally filed.
The appeals court decided that the note must show ownership before the foreclosure was initially filed.
Record Fixed Rates Might Fall Further
The average 30-year fixed-rate mortgage fell 5 basis points over the past seven days to its lowest level ever recorded.
The 15-year mortgage averaged 6 BPS less than last week, also a record.
An analysis of Treasury market data indicated that mortgage rates could be 5 BPS better in next week's report.
Servicers Recognized for Foreclosure Prevention
Fannie Mae recognized JP Morgan Chase Bank, N.A., for its utilization of foreclosure alternatives during the third quarter.
The recognition was part of Fannie's Servicer Total Achievement and Rewards program.
Also acknowledged for foreclosure prevention were PHH Mortgage Corp. and U.S. Bank, N.A.
Mortgage Whistleblowers Courted by CFPB
The Consumer Financial Protection Bureau announced an e-mail address and phone number that employees of financial services firms can use to report violations of federal law.
The regulator plans to add a website portal early next year for submitting tips.
"People who submit tips through any of these channels may request confidentiality or even remain anonymous to the extent permitted by law," the CFPB said.
Completed Foreclosures Surpass 1 Million
U.S. mortgages that were converted to real estate owned during November were less than 57,000.
Repossessions retreated from more than 67,000 filings in October.
From Jan. 1 through Nov. 20, REO filings exceeded 1.0 million.
IL Program Provides Down Payment Grants to Veterans
Current and former members of the military can receive grants of $10,000 for home purchases in Illinois through a new program.
"Welcome Home Heroes" was announced Wednesday by the state's governor.
The grants can be used toward down payments and closing costs.
Uniform Data Deadline Delayed
Fannie Mae and Freddie Mac were previously directed by their regulator to require utilization of the Uniform Loan Delivery Dataset for loans delivered on or after March 19, 2012.
The initiative was designed to improve the consistency and quality of data for appraisals and other information.
Now the required implementation data has been delayed more than four months.
Online Originator Opens in Dallas
A company that claims to be one of the largest non-bank residential lenders in the country has opened an online origination operation in Dallas.
The new business is FinanceMyHome.com.
Plans are to staff FinanceMyHome.com's headquarters office with 90 people.
First-Half 2013 Production Forecast Slashed
Last month, residential originations by U.S. lenders was forecasted to come in at $388 billion during the first-quarter 2013.
The following quarter was expected to bring in $467 billion in home-loan production.
But this month's outlook now has total volume during the first six months of 2013 at just $595 billion.
M.I. Firms Push Forward Despite Adversities
Radian Group Inc. announced a realignment of its operational structure and subsequently disclosed that its core business subsidiary has requested that a dozen states waive capital ratio requirements.
Republic Mortgage Insurance Co. was recently suspended by Freddie Mac and Fannie Mae.
But despite the adversities, the mortgage insurance industry has thrown its support behind the Home Affordable Refinance Program, while MGIC has lowered credit score requirements on refinances and Genworth Residential Mortgage Assurance Corp. was approved by Freddie as a "Limited Insurer."
Former WaMu Execs Settle FDIC Lawsuit
Three of the top executives at the helm Washington Mutual Bank around the time it became the biggest bank failure in U.S. history have agreed to a settlement with the Federal Deposit Insurance Corp.
The FDIC previously filed a lawsuit in federal court against Kerry Killinger, Stephen Rotella and David Schneider.
Regulators claimed that the bank failed in 2008 because the executives focused only on toxic mortgages that could be sold for the greatest profit.
Commercial Mortgage Executive Appointments
The Federal Housing Administration lending business at Prudential Huntoon Paige is now being led by Paige Warren.
Prudential Mortgage Capital Co. said that Michael McRoberts would join the company as managing director of its conventional Fannie Mae and Freddie Mac lending business.
Former Freddie Mac associate director for multifamily credit and underwriting Rick Del Roio has been appointed vice president of credit at Beech Street Capital.
Senior Executives Recruited, Replaced
First California Mortgage Co. disclosed that L. Andrew Pollock was hired as president and chief administrative officer.
The former chief mortgage operations officer at PennyMac Home Loan Services has joined loanDepot.com as executive vice president, head of corporate strategy.
Nationstar Mortgage LLC named Jay Bray as its chief executive officer.
Best Practices for Expanding Mortgage Originations
A recent conference presentation addressed the 10 best ways to engage clients and referral sources.
The most costly methods didn't necessarily produce the most successful results.
The most successful practice used in generating business is working the community.
Appraisers Guaranty Values
Nationwide Appraisal & Settlement Network announced that its appraisal values are now backed by an insurance policy.
Back in 2007, FirstClose said it would guaranty values derived from its automated valuation model.
StreetLinks National Appraisal Services said last year that it has been providing a warranty of appraisal quality and appraiser competency on each of its appraisals.
Net Branch Matchmaker
A company operating from Georgia wants to become the eHarmony of net branching.
That company is Mortgage Brokers Network Corp Inc.
The firm claims to represent "some of the best mortgage companies in the business."
Settlement Calls for Expedited Modifications
When it was sued by the state of Ohio two years ago over the way it handled loan modification requests, American Home Mortgage Servicing Inc. filed its own lawsuit against the state.
Now, the Coppell, Texas-based servicer has come to an agreement with the state.
A settlement announced Monday requires American Home to process Ohio loan-modification requests in a timely fashion and suspend foreclosures during the modification process.
BofA, Bond Insurers Busy in Court
GMAC Mortgage LLC and Residential Funding Company LLC were named as defendants in three lawsuits filed by Financial Guaranty Insurance Co.
DLJ Mortgage Capital Inc. was sued by Assured Guaranty Corp.
In other litigation tied to mortgage-backed securities, units of Bank of America Corp. have frequently been named as defendants.
FHFA Sues City of Chicago
A recently passed Chicago ordinance requires mortgagees to conduct monthly inspections to determine if a property is vacant and pay a $500 registration fee for vacant properties.
This is the case even if the property hasn't yet been take back through foreclosure.
So the Federal Housing Finance Agency has sued the city in an attempt to block enforcement of the ordinance.
California Claims No. 1 Mortgage Fraud Ranking
California's Mortgage Fraud Index was 153 in the third quarter.
The index was higher than the prior quarter and prior year.
Based solely on the dollar amount of cases with third-quarter activity, California's $204 million was the highest balance of cases.
Real Estate Investors Fueled Bubble in Hard-Hit States
A new study found that real estate investors helped fuel the run-up to the frenzy that preceded collapsing prices in the hardest-hit housing markets. The share of investor loans in four states with the most damage surged over the seven years leading up to the reversal of fortune.
The report, from researchers at the Federal Reserve Bank of New York, found that investors played a disproportionate role in inflating prices to unsustainable levels in the states of Arizona, California, Florida and Nevada.
The share of owner occupancy on residential loans had climbed to 45 percent at the peak of the bull market in the four states from only a quarter at the turn of the century.
Refis Rise Again Despite Purchase Slump
Inquiries for purchase loans fell 2 percent from last week in the Mortgage Market Index report.
But refinances climbed 12 percent over the past seven days.
Refinances were even 13 percent stronger than the year-earlier week.
Multifamily CMBS Delinquency Drop Offsets Rise in Office, Hotel
Defaults on securitized multifamily loans fell 28 basis points between October and November.
At the same sime, delinquency on loans secured by office properties climbed 27 BPS.
In addition, the rate on hotel commercial real estate loans was up 12 BPS.
Mixed Delinquency Data at Radian
The number of past-due policies at Radian slipped less than one percent between October and November.
However, the mortgage insurer's policy count has been diminishing at a faster pace.
That indicates Radian's delinquency rate increased around 5 basis points during the period.
30-Year Frozen Near 4%; Rates Might Retreat
This week's 30-year mortgage slipped 1 basis point from last week.
The 30-year mortgage has stubbornly stayed within 2 basis points of 4 percent for six weeks now.
An analysis of Treasury market activity indicated that mortgage rates could be as much as 6 BPS better in next week's report.
Servicing Performance Deteriorates
The average mortgage servicer saw its servicing portfolio sink 22 percent between June and September.
The diminishing portfolios helped drive down the number of loans handled per servicing employee by more than a hundred.
Net servicer earnings swung to a $28 loss per loan.
Productivity Picks Up as Profits Double
Quarterly production profits doubled during the third quarter.
Third-quarter originations worked out to more than 2.7 closings per production employee.
Productivity increased from the three months ended June 30, when closings per employee were less than 2.3 loans.
Auditors Sued Over Financial Fraud at Failed Firm
The bankruptcy trustee in the case of Meridian Mortgage has filed a lawsuit against the failed firm's former auditor over its role in the Ponzi scheme being operated at the company.
Meridian founder Frederick Darren Berg, who already pled guilty and is also named as a defendant, allegedly diverted around $100 million of investor funds for personal use and to maintain the Ponzi scheme.
He fooled the auditors by renting private mailboxes for fictitious borrowers on fake loans then answering letters from the auditor himself.
Early Sign Delinquency Down in November
An early indication of monthly delinquency on residential loans had the past-due rate falling more than 60 basis points during November.
The statistic was based on an analysis of monthly operational at Mortgage Guaranty Insurance Corp.
Delinquency declined 65 BPS compared to a year earlier.
Former Countrywide Exec Says Some Senior Execs Committed Crimes
A former executive vice president at Countrywide Financial Corp. was fired, she claims, before she had a chance to talk at a planned meeting with government regulators about mortgage fraud at the company and the senior executives who condoned it. She was recently awarded nearly $1 million.
In 2007, Countrywide Home Loans originated more residential mortgages than any other U.S. lender: $408 billion.
The Calabasas, Calif.-based company also had the most production in 2004, 2005 and 2006.
Obama Administration Warns Best HAMP Producer
JPMorgan Chase Bank, N.A. completed more loan modifications under the Home Affordable Modification Program during October than any other mortgage servicer.
Chase was able to increase its volume by 8 percent from September.
But overall HAMP activity fell to the lowest level since the first modification was reported for October 2009.
Delinquency Down from Q2 on CMBS Loans, Bank CRE Loans
The rate of delinquency on commercial real estate loans that are owned by financial institutions tumbled 19 basis points between the second and third quarters.
The rate on securitized CRE loans was down 10 BPS during the same period.
But compared to a year earlier, the two categories diverged in their performance.
After Q1 Peak, Delinquency Headed Lower
Residential delinquency of at 60 days is expected to peak just above 6 percent in the first-quarter 2012.
But then, delinquency is expected to decline each quarter for the rest of next year.
The improvement is expected despite continued pressure on home prices and unemployment.
Mortgage Firm's Owner Sued by Ex
American Equity Mortgage and its former front man, Ray Vinson, are well known to St. Louis residents. He claims in a new lawsuit that unsavory tactics were used in his divorce proceedings that would determine who got what share of the lender. It's a tale of lies and deceit.
In 2006, Vinson's ex-wife was awarded more than $60 million in their divorce. The judgment included all of American Equity.
Vinson, who was awarded less than half that amount, engaged in "less-than-perfect behavior" and embarrassed his ex-wife through infidelity, domestic violence and alcohol abuse, the judge wrote in the decree.
Fla GOP Proposing Expedited Foreclosure Legislation
Legislation being proposed by state GOP lawmakers in Florida would enable mortgage servicers to cut down on the time it takes to complete a foreclosure and help clean out some of the state's excessive inventory. But the legislators also see a need for safeguards that protect borrowers from an abusive repossession process.
A Republican state senator is drafting a bill that would enable an expedited foreclosure process on vacant properties and delinquent borrowers with no legitimate cause to delay the foreclosure.
A state representative, also a Republican, has filed a bill requiring a final judgment if the judge decides that the borrower does not have a legitimate defense to fight the foreclosure.
Repurchase Tally Exceeds $4 Billion at SunTrust
During the past six years, SunTrust Banks racked up more than $4 billion in repurchase demands.
At an investor conference, the company's chief executive officer talked about which vintages have performed the worst.
He also reviewed recent quarterly repurchase costs as well expectations for upcoming activity.
Federal Agencies Reviewing Risk Retention Feedback
Several agencies issued a notice of proposed rulemaking.
Numerous comment letters were received in response to the proposed rule.
"The agencies are in the process of evaluating those comments," the acting chairman of the Federal Deposit Insurance Corp. said in congressional testimony.
Mass. AG Strikes Back at GMAC
Less than a week after GMAC Mortgage LLC responded to litigation filed by the Commonwealth of Massachusetts by backing out of the third-party originations in the state, Massachusetts' attorney general has retaliated with a request for a congressional investigation.
GMAC was among several mortgage servicers sued last week by Massachusetts' Attorney General Martha Coakley.
The Ally Financial subsidiary followed up by eliminating originations in the state from mortgage brokers and loan correspondents.
Calif., Nev. to Jointly Investigate Servicers
With the worst foreclosure rates in the country, a pair of states in the West have teamed up to pool their resources and speed up investigations of mortgage servicers.
Attorneys general from California and Nevada met in Southern California Tuesday to announce an alliance.
The partnership comes as the pair of states have pulled out of nationwide settlement talks with mortgage servicers and aggressively pursued their own robo-signing investigations.
$1 Billion Producer Claims Top St. Louis Spot
USA Mortgage reported that it expects to exceed $1 billion in originations during 2011.
The lender also surpassed $1 billion in fundings during the prior two years.
USA says it will become the biggest lender in the St. Louis area for the first time ever.
Case That Sparked Robo-Signing Scandal Decided
The foreclosure case that led to uncovering the practice of robo-signing by the nation's servicers in foreclosure processing has been decided.
The foreclosure was filed by GMAC Mortgage LLC, which admitted that it had used a faulty affidavit in the process of foreclosing.
The borrower was appealing a lower-court ruling that allowed GMAC to proceed with the foreclosure.
Wholesaler Launches Jumbo Product
United Wholesale Mortgage has launched a new jumbo mortgage program.
Loan amounts can go as high as $2.5 billion.
The company claims that its product is "the only true jumbo loan in the country that originators can close in two weeks or less."
Another New Low for Wholesale HECM Lenders
Wholesale lenders saw home-equity conversion mortgage production fall 18 percent between September and October.
The latest total was the lowest since Reverse Market Insight began reporting the numbers in April 2008.
Wholesale originations fell 30 percent from October 2010.
3 More Notaries Indicted in LPS-Related Case
A case involving employees of Lender Processing Services Inc. has yielded criminal charges on three more defendants.
The Nevada Attorney General's Office announced Monday that a criminal complaint had been filed against three notaries public.
The complaint was filed just weeks after two other defendants were indicted by the state.
Republicans Vow to Block CFPB Nomination
Most Senate Republicans have vowed to block approval of President Obama's nominee to head the Consumer Financial Protection Bureau. So Obama is hoping to convince two senators from Maine to break ranks with the GOP.
Former Ohio Attorney General Richard Cordray is the president's nominee to head the bureau.
But Republicans are concerned about how the structure of the bureau concentrates power in the director's position and the lack of budget authority that Congress has over the agency.
Another New Record for MTA
An analysis of Federal Reserve data indicates that the MTA was a little less than 0.2 percent in November.
That was more than a basis point lower than in October.
An analysis of Federal Reserve data indicates that the MTA was 0.19583 percent in November.
New FHA Loan Limits Released
Recently enacted legislation impacted loan limits on mortgages that are insured by the Federal Housing Administration.
Details about the new limits have been released in a mortgagee letter from the Department of Housing and Urban Development.
On a single-family property in an area designated as "high-cost," the limit is $729,750.
Bankruptcy Filings Fall Again
Consumer bankruptcies were down 5 percent between October and November.
It was the fifth consecutive month that fewer filings were made.
Compared to a year ago, bankruptcies were down 16 percent.
Ginnie to Cover Updates at Online Event
Issuers of mortgage-backed securities guaranteed by the Government National Mortgage Association will have a chance to learn about program updates at an upcoming online event.
The multimedia event will include a conference call.
It will also include a live online presentation through personal computers.
New York Probing Military Foreclosures
New York's attorney general is investigating whether 10 mortgage servicers have illegally foreclosed on the homes of active-duty members of the military.
At issue are possible violations of the Service Members Civil Relief Act.
The 2003 law sets strict standards on the foreclosure process for active-duty soldiers.
Chase Continues Hiring Spree
JPMorgan Chase & Co. is recruiting mortgage employees in Chicago.
More than 400 positions are open.
The hirings are on top of more than 2,000 mortgage hirings this year in several states.
Patton Boggs Mortgage Group Jumps Ship
A core group of mortgage attorneys at Washington, D.C.-based Patton Boggs LLP have joined another firm based in the nation's capital.
The quartet includes Richard Andreano Jr., Reid F. Herlihy, John Socknat and Michael Waldron.
The new home for the four attorneys is Ballard Spahr LLP.
Millions Could Join the Ranks of Those With Credit Scores
Millions of consumers who currently have no credit scores could become prospective mortgage borrowers as the credit bureaus start considering non-traditional files in their reports. But consumer groups worry that the changes will reveal delinquent payments that have thus far stayed under the radar.
New credit scoring systems being pushed by credit agencies use payment histories on phone service, Internet service and utilities.
Others agencies have beefed up data caches to include job history, assets and income. Even rental history is being factored in.
Squatting Balloons in Texas County
A former insurance agent from Tennessee filed an affidavit in a county recorders office and claimed that she owned the vacant $2.7 million mansion listed on the document -- forcing Bank of America Corp. to stop marketing the real-estate-owned property until it could clear the claim. She is just one of a rash of squatters -- some who are convicted criminals -- that have recently come to Texas looking for a free home through adverse possession.
The mansion, located in Fort Worth, had been foreclosed on earlier this year and was being marketed by Southeby's.
But the former insurance agent pulled the "for sale" signs from the ground, cut the chain from the gates of the estate and claimed ownership through adverse possession.
Mortgage Business Recovers From Holiday
The U.S. Mortgage Market Index from Mortech Inc. and MortgageDaily.com for the week ended Dec. 2 was 43 percent higher than a week earlier.
Refinance inquiries climbed 44 percent as refinance share edged up.
The number of people who were seeking financing to purchase a home increased 42 percent.
Third-Party Lender Exits Massachusetts
GMAC Mortgage said it will stop originating Massachusetts business through mortgage brokers and correspondent lenders.
The company, however, will continue to service existing borrowers and honor contractual obligations as a servicer.
"The company is disappointed that it can no longer participate in offering certain financing options in Massachusetts," the statement said.
Mortgage Jobs Expand as U.S. Unemployment Improves
Mortgage broker staffing grew 4 percent between September and October.
The increase was enough to overcome a small decline at mortgage bankers.
The bigger news, however, was the U.S. unemployment rate -- which sank to its lowest level in more than two-and-a-half years.
MetLife Emerges as Dominant Reverse Lender
MetLife Bank closed more than 1,200 retail-originated home-equity conversion mortgages in November.
That was the most HECMs closed of any reverse lender.
In fact, MetLife closed more than three times as many retail loans than the next-biggest originator.
Low Rates Might Rise
The average 30-year mortgage inched up 2 basis points this week.
The 30 year has lingered within 2 basis points of 4 percent for five consecutive weeks now.
But it looks like mortgage rates could rise around 10 BPS by the next report based on Treasury market activity.
VA Changing Loan Limit Calculations
The way that limits are calculated on loans guaranteed by the Department of Veterans Affairs is changing next year.
In a bulletin, VA said that the method used to calculate loan limits for VA loans will change in 2012.
"It's possible Congress may pass legislation affecting the way our limits are calculated and if so we will post any changes on our website," the bulletin stated.
MA AG Sues Major Servicers Over Foreclosure Practices
The biggest mortgage servicers in the country, along with the Mortgage Electronic Registration System Inc., have been named in a lawsuit filed by the Commonwealth of Massachusetts.
The companies are accused of using fraudulent documents in the foreclosure process, filing foreclosures without having title to the loans and skirting state recording requirements and fees by utilizing MERS.
Also at issue is their handling of loan modifications.
CMBS Lates Tumble But Expected to Climb
Delinquency on securitized commercial real estate loans fell 26 basis points between October and November.
Hotel property loans helped last month's performance, with delinquency plummeting 184 BPS.
But the improving metrics are expected deteriorate next year.
COFI Tumbles to Record Low
The Cost of Funds Index declined 6 basis points between September and October.
COFI was 44 BPS lower than in October 2010.
Based on data reported by the Federal Home Loan Bank of San Francisco going back to July 1981, COFI has never been this low.
2011 Agency MBS Issuance Nears $1 Trillion
The issuance of fixed-rate mortgage-backed securities at Fannie Mae, Freddie Mac and Ginnie Mae exceeded $107 billion during November.
Aggregate activity climbed more than $10 billion from October.
During the first 11 months of this year, agency issuance was more than $0.9 trillion.
GSEs Suspend Foreclosure Evictions
Freddie Mac announced that it has suspended all evictions on foreclosed properties during the holidays.
Fannie Mae issued a similar announcement.
The government-sponsored enterprises indicated that the moratorium applies to occupied single-family and two- to four-unit properites that they own.
Independent Servicer Reviews ID Thousands of Potentially Illegal Foreclosures
The independent reviews of foreclosure practices at the nation's biggest mortgage servicers have identified thousands of potentially illegal foreclosures on members of the military.
At issue are around 4,500 foreclosures on borrowers who indicated they were eligible for relief under the Servicemembers Civil Relief Act.
Bank of America Corp. has agreed to work with an independent contractor and review more than 2,400 foreclosures, while Wells Fargo & Co. has agreed to review 871 foreclosures. |
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Net Branch Matchmaker
Dec. 13, 2011
A company operating from Georgia wants to become the eHarmony of net branching.
Mortgage brokers who are searching for a national mortgage banking firm to join have a plethora of options.
The Mortgage Branch Directory at Mortgage Daily lists more than 50 companies looking to recruit mortgage branches.
<MortgageDaily.com subscribers read full story>
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Mortgage Jobs Expand as U.S. Unemployment Improves
Dec. 2, 2011
Growth in staffing at mortgage brokers overcame a small decline at mortgage bankers and pushed overall employment in the real estate finance sector higher. The bigger news, however, was the U.S. unemployment rate -- which sank to its lowest level in more than two-and-a-half years.
The mortgage industry employed 236,500 people during the month of October, though the government employment data is likely to be revised multiple times over the next 12 months.
Industry-wide headcount grew from a revised 235,000 during September, according to the Bureau of Labor Statistics.
<MortgageDaily.com subscribers read full story>
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