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Mortgage Industry News Headlines
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Last Updated Tuesday, February 28, 2006 04:26 AM CST
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Lawsuit Suggests Ameriquest Shouldn't Have Made Loan
An elderly woman alleged in court documents that, after she contacted Ameriquest Mortgage Co. in March 2005 about getting a loan for $4,000, two representatives convinced her that she would save money by getting a loan through the company. She claims company representatives cajoled her into obtaining a loan at double the interest rate she could have gotten from her credit union.
Freddie's Total Portfolio Nearing $2 Trillion
Freddie Mac's total mortgage portfolio surpassed $1.7 trillion, according to January's monthly volume summary report. The secondary lender reported new business purchases of more than $40.0 billion.
Option One Production Plunges
Option One originated $8.6 billion in the quarter ended January 31, falling from record second-quarter volume, H&R Block Inc. announced Thursday. "Loan origination levels have been at the lower end of our expectations as competitive pressures in the industry continue," said H&R Block's chairman and chief executive officer in the announcement.
Hybrids Fuel Jumbo RMBS Volume
Prime jumbo issuance of $51 billion in fourth quarter 2005 fell from the third quarter, according to a Standard & Poor's report for the jumbo sector. The decline is due to rising interest rates and general uncertainty in the economy.
Rates Ease, Apps Edge Up
The 30-year fixed-rate mortgage average slipped last week to 6.26%, according to Freddie Mac's latest Primary Mortgage Market Survey. Overall, originators completed just 1% percent more mortgage applications than they did in the previous week, the Mortgage Bankers Association reported.
Option One, Accredited Stung by Drug Ring
A former employee of an Ohio mortgage loan brokerage has pleaded guilty to conspiracy to launder money and failing to file a tax return. She is one of 17 people charged in what federal and local authorities have described as the largest drug ring in Dayton, a city about 40 miles north of Cincinnati. Mortgage lenders stung by the scam included Accredited Home Lenders and Option One Mortgage Corp., according to the indictment.
Origination Software Goes Virtual
Access Business Technologies recently announced the release of product can interface with Calyx Software, Byte, and Intrac, and offers an online servicing platform for midsize servicers. The company's CEO told MortgageDaily.com that its hosting environment provides the platform for "a mobile remote desktop" allowing for mortgage processing and servicing tasks to be accessed on the Internet from anywhere.
Yield Curve Not Poised for Change
Early Thursday, the 10-year Treasury note yielded 4.55%, lower than the 2-year Treasury 4.71% yield. The inversion in the yield curve follows nearly two years of flattening activity. The structural forces holding long-term interest rates down may be with us for some time, even as the cyclical increase in short-term rates subsides," according to the Federal Deposit Insurance Corp.
Impac Claims #4 Alt-A Spot
Fourth quarter mortgages acquired and originated totaled $6.0 billion, off from the prior quarter and the comparable period a year earlier, Impac Mortgage Holdings Inc. announced Tuesday. Fourth quarter earnings plummeted to $25.3 million from the prior quarter's $126.4 million, the announcement said.
Bank Took 2 Years to File Politician's Mortgage
A candidate for Massachusetts governor in a Democratic primary took a $1.2 million loan from SunTrust Bank of Atlanta in the spring of 2003. But in an atypical set of circumstances for the mortgage industry the deed was not recorded until June of last year.
New Century Battling Investorsx
Greenlight Capital LLC, among other investors, recently amended a 13D filing with the SEC, notifying of an intention to file a proxy statement and nominate three directors to New Century Financial Corp.'s board at the 2006 annual meeting. But New Century's lead independent director said the filing "mischaracterizes the ever changing set of issues Greenlight has raised since its amended 13D filing in April 2005."
GMAC Does Servicing Deal
GMAC Mortgage Corp. recently announced it will handle interim subservicing for Americorp Credit Corp.'s first mortgages and closed-end second mortgages. Under the arrangement, Americorp will originate the loans on a retail and wholesale basis and GMAC will service loans that are held in a portfolio and awaiting sale, according to the announcement.
Lenders Partner to Prevent Predatory Lending
The Opportunity Finance Network, a group of financial institutions nationwide, announced the first phase of a multi-billion-dollar partnership it created with responsible mainstream mortgage lenders for responsible subprime lending. "We are developing a national responsible subprime mortgage platform to challenge predatory lenders who are stealing wealth from homeowners," the group's president said in the written statement.
Mortgage Jobs Coming to TX, CA
Homefield Financial announced Friday it will open an offices in southern California and North Texas that will result in a 75% increase in its current staff by the end of 2007. "Homefield's expansion to Texas is a powerful indicator of the company's successful growth and bright future," said a Homefield executive in the announcement.
Lead Co. Founder Recognized by Software Group
The founder of LowerMyBills.com was chosen as a finalist for the Entrepreneur of the Year by a software group, according to an announcement. The finalists represent individuals who have made "outstanding contributions to the industry," the statement said.
LOs Sue First Horizon
A federal judge's "certification means that there are more than 5,000 employees who are eligible to join the lawsuit and seek damages for unpaid overtime," said the attorney of seven loan officers who claim that First Horizon Home Loan Corp. did not pay them overtime. Their lawsuit alleges that First Horizon violated state law by failing to pay earned commissions and violated federal law by failing to pay overtime wages to loan originators who worked more than 40 hours per week.
10 Calls Cost Broker $100,000
An Englewood, Fla., mortgage broker is facing fines of up to $100,000 for allegedly making 10 calls to residents who paid to be put on the state's "do-not-call" list, according the state. The company, which allegedly made the calls between June and November of last year, also used recorded messages, which is a separate violation of Florida law, the department said in a statement.
Man Faces Life Sentence for Running Down Originator
A mortgage loan officer shouted at the driver of a silver BMW to slow down as it sped through the parking lot of the restaurant he had just finished eating at. But then the driver swerved and then turned the car on the originator. If convicted of all charges, the driver could be sent to state prison for life.
Thrift Fundings Fall
Fourth quarter residential mortgage originations at thrifts totaled $164.0 billion, the Office of Thrift Supervision reported. Production dropped from the third quarter but was higher than the comparable period a year earlier.
Loans Backing RMBS Drawing Concern
Some attendees at an asset-backed securities conference last week expressed strong feelings that the mortgage market has been too eager to extend credit to home owners, according to an announcement by conference provider Information Management Network. "We are beginning to see prudent home mortgage deal terms and conditions being replaced by more liberal structures," a speaker reportedly said at the conference's opening session.
Subprime Entrepreneur At It Again
The founder of EquiFirst Inc. has launched another subprime mortgage wholesaler. So far he has hired about 30 people -- including four key executives -- and eventually plans to have more than 200 employees, he told MortgageDaily.com. "Our whole goal is to make transactions paperless ... with an online portal so mortgage brokers can get pre-approvals and full approvals and underwriting quickly and seamlessly online."
Yield Curve Inversions & Mortgages
The 30-year fixed-rate mortgage averaged 6.28%, up from a week ago and a year ago, according to Freddie Mac's latest rate survey. The 10-year Treasury-note yield was lower than the yield on the two-year Treasury. Some analysts believe the phenomenon, known as an inverted yield curve, signals an upcoming recession.
Mortgage Banker Tycoon
Prism Business Ware Games Inc. announced it recently upgraded the user-interface of its business simulation designed for mortgage bankers to develop mid- to senior-management's strategic, financial, and general business acumen. The business-training software package "models the operations of a working, growing loan center and allows course attendees to run their simulated company as 'CEO for the Day'."
WaMu Laying Off Thousands
Washington Mutual Inc. said Wednesday it will consolidate its processing offices providing administrative support to its home loan businesses. Downsizing the network of mortgage support offices will result in approximately 2,500 job cuts, WaMu said.
Freddie Ponders Subprime Expansion
A Freddie Mac executive shared with investors at a recent Credit Suisse Financial conference the successful stride Freddie has continued to achieve over the recent years and how it might be a good time to expand their market share into the subprime arena. "The idea of touching more loans is to increase our penetration of the overall conventional conforming market," she explained.
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