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Mortgage Industry News Headlines
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Last Updated Friday, February 09, 2007 03:22 PM CST
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Another Wholesaler Falls
Lenders Direct Capital Corp. stopped taking applications from mortgage brokers as of Friday, the company's chief executive officer, told MortgageDaily.com. He cited lack of investor demand for subprime business. A small retail operation will remain open, he said.
Countrywide Originations Fall
Loan originations were $37.1 billion last month, Countrywide Financial Corp. announced Friday. December's volume was lower than the prior month, the data indicate. The monthly decline was "in part a reflection of normal seasonal effects," Countrywide said.
Fines Over Discarded Files
The North Carolina Attorney General fined two mortgage companies for improperly disposing mortgage applicant's personal information, according to an announcement. One of the companies was fined $12,500 for throwing files in the dumpster. "These companies turned trash into treasure for identity thieves by dumping their customers personal information," the attorney general said in the statement.
Fla. Co. Hiring
Proficio Mortgage will add at least 50 jobs this year, the chief executive officer of the parent company told MortgageDaily.com. The additions are part of a national expansion, he said. Proficio Mortgage is based in Jacksonville, Fla.
Subprime Shares Sink
Warnings from two nonprime mortgage players prompted a sell off in shares of publicly-traded subprime lenders Thursday. New Century Financial Corp. shares were down more than 35%. NovaStar Financial Inc. saw its stock price fall by more than 10%.
ID Fraud Rises
Identity theft topped the list of consumer fraud complaints the Federal Trade Commission received, according to an annual report the agency released Wednesday. The increase represented the seventh consecutive year of increases, the report indicated. Real estate loan fraud was associated with 1.3 percent of the ID theft complaints, according to the report.
Rates Improve
The 30-year fixed-rate mortgage averaged 6.28%, according to Freddie Mac's latest weekly survey. The 30-year fell from the prior week, the report indicated. The long-term mortgage average, however, was higher than a year earlier.
HSBC Increases Impairment Charges
HSBC Holdings plc announced Wednesday it is setting aside 20 percent more than the consensus estimates for loan impairment charges. The charge is be accounted for at the end of 2006 for mortgage services operations, the company said. The warning comes ahead of the group's 2006 results announcement, due March 5.
Steady Rise for MTA
The Monthly Treasury Average was 4.983% in January, according to Federal Reserve data. The average edged up from December. The MTA has risen for 33 consecutive months.
New Century to Restate
New Century Financial Corp. announced it will restate its consolidated financial results for the first three quarters of 2006. The restatement is reportedly needed to correct errors in accounting for the allowance for loan repurchase losses. It expects net earnings for each of those quarters to be reduced.
Predatory, Foreclosure Hearings
The chief economist for the Mortgage Bankers Association told a Senate banking committee Wednesday that suitability requirements will hinder the advances of the mortgage industry. "The effect will be to reduce available and affordable credit," he said. The president of the National Association of Mortgage Brokers testified that improved disclosures are critical in addressing the disturbing increase in foreclosures.
Hard Money Lender Expands
WexTrust Capital LLC announced it is expanding its hard money programs. "We are better prepared to consider a broad range of collateral options," a WexTrust executive said in the statement. WexTrust will finance non-owner occupied 1-4 unit residential properties, a spokesman told MortgageDaily.com in an e-mail statement.
N.Y. Mortgage Trust Unloading Ops
IndyMac Bank will acquire certain assets of The New York Mortgage Company LLC, according to an announcement Wednesday. The deal includes 21 full service retail mortgage banking offices, the statement said. "Due to the persistence of the significant challenges facing the mortgage industry, our board of directors has been engaged over the past several months in confidential preliminary discussions with several companies," New York Mortgage's chairman said in the announcement.
Sales Team Exit Spawns Lawsuit
A lawsuit has been filed by American Home Mortgage Corp. against one of its former sales managers. The company accuses the former employee of breaching the agreement he signed with American Home. The lender claims that the defendant influenced four of its loan officers to make the switch with him to a new employer.
New CEO at Reverse Lender
Michelle Minier has assumed full CEO duties at Financial Freedom Senior Funding Corp., according to an announcement Wednesday. She is an 11-year veteran of IndyMac Bank, the statement said. Financial Freedom is a subsdiary of IndyMac.
Cashouts Fall
In the fourth quarter 2006, 84 percent of refinanced mortgages owned by Freddie Mac included cashout, according to an announcement Tuesday. The share of cashouts was down from the prior quarter, Freddie said. Cashout loan volume fell 12 percent from the previous three month period.
Reverse Wholesaler Launched
LLS Financial launched wholesale lending operations, according to an announcement from its parent company. The new operation will provide reverse mortgage programs for mortgage brokers. The timing was right to launch wholesale operations, the CEO of the parent company said in the statement.
RMBS Ratings Actions Down
Ratings upgrades on residential mortgage-backed securities numbered 337 in 2006, Moody's Investors Service reported. The figure was lower than the prior year, the agency reported. However, Moody's also said downgrades declined last year.
Banks Tighten Underwriting
The Federal Reserve Board released its January 2007 Senior Loan Officer Opinion Survey on Bank Lending Practices. Responses were drawn from 57 domestic banks, the Fed said. About 15 percent of domestic banks reportedly said they had tightened credit standards on such loans over the past three months.
Mortgage Lead Consolidation
Root Markets Inc. announced that it acquired a mortgage lead provider. The merged company will be called Root LeadROI. Meanwhile, Fidelity National Real Estate Solutions Inc. announced it acquired GoApply.
HEL Fraud Risks
Financial Insights announced the results of its report, Combating Fraud in Home Equity Lending: The Enemy of My Enemy Is My Friend. The report examined the results of new research into emerging fraud within home equity loan portfolios. The report highlighted three documented incidents of home equity fraud that demonstrate the industry's potential exposure.
HUD Budget Disappoints Lenders
The Bush administration proposed $35.2 billion in its 2008 budget for the Department of Housing and Urban Development, the agency announced Monday. But the budget increases fees for key housing guarantee and insurance programs and falls short on FHA reform, the Mortgage Bankers Association said in its own announcement Monday. Proposed reforms should go further and provide FHA the ability to introduce new loan programs without the approval of Congress, MBA said.
Subprime Defaults Soar
The default rate on subprime loans hit 10.1% in November, Friedman Billings Ramsey & Co. reported. The latest numbers were the worst since 2001, the investment banker said. Subprime foreclosures were also on the rise in November, according to the report.
Banks, Fraud Firms Merge
A company claiming to be the third largest Texas-based bank announced that it completed the purchase of Texas United Bancshares Inc. on Wednesday. IBERIABANK Corp. reportedly acquired two Arkansas-based companies, according to announcements. First American Real Estate Solutions announced it merged with CoreLogic Systems Inc.
5 Bad Attorneys
In the past month, five lawyers in Westchester County, N.Y., have been charged or pleaded guilty in unrelated but often similar mortgage fraud cases. One of the attorneys who represented her aunt in several real estate and financial matters withheld $860,000 in proceeds from her aunt. Another lawyer allegedly received $470,143 from the sale of a property owned by an elderly client but issued a bad check to cover the amount owed.
200 Unlicensed Loans Made
Candace Company Inc., Cadillac Properties Inc., Payment Center Inc. and the president of the three companies have been sued by Illinois' attorney general. The state claims the companies have issued more than 200 mortgages without a license. But a company spokesman told MortgageDaily.com, "It's all a misunderstanding."
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Copyright © 2005 MortgageDaily.com
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| Brokers Better for Subprime Borrowers
Subprime borrowers who use mortgage brokers pay less than when obtaining their mortgage from a mortgage banker, according to a joint study from economists at George Washington and Oklahoma State Universities. But a mortgage banking group questions the consistency of the findings.
This was the conclusion from data analyzed from the third quarter of 1995 through the end of 2003 from the subprime mortgage subsidiaries of 10 large financial institutions, the report said.
"The results indicate that broker-originated mortgages are not more costly and generally less costly to the borrower than lender-originated mortgages after holding other loan terms and borrower characteristics constant" the economists reported. "They are consistent with hypotheses that brokers may be more efficient than lenders in originating loans and may be better able to match borrowers' and lenders' reservation prices."
MortgageDaily.com subscribers read full story
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| Licenses Lost
Georgia regulators have issued cease and desist orders to four mortgage brokers.
None could be reached for comment by MortgageDaily.com and the department only releases limited information on cease and desist orders.
Several alleged offenses were given by the department in its announcements, including making false statements to lenders, employing felons, making illegal payments to employees, not keeping proper records, conducting business with unlicensed brokers and lenders and making false statements to the state.
MortgageDaily.com subscribers read full text of story
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Broker Named to Fed Council
A mortgage broker is one of 10 new members of a Federal Reserve Board council.
The Fed appointed Joseph Falk, the legislative chair of the National Association of Mortgage Brokers, to its Consumer Advisory Council, according to an announcement today.
Falk will reportedly serve a three-year term on the council, which meets three times a year in Washington, D.C., and advises the board on important policy issues related to consumer financial services under the Consumer Credit Protection Act.
MortgageDaily.com subscribers read full story
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CA Broker Busy Growing
A mortgage broker is looking to double its staff of high producers and support personnel in California next year.
Business is booming at Twin Capital Mortgage and the employee base must expand to keep the momentum rolling, company Chief Executive Officer Darius Mirshahzadeh told MortgageDaily.com.
In the past seven months alone, the San Francisco brokerage originated $220 million of the year's expected total of $300 million -- surpassing the total of $150 million in all of all of 2005, according to the executive.
MortgageDaily.com subscribers read full story
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