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MortgageChronicle.com Archives
April, 2011
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D.C. Alliance Tackles 3 Pressing Issues
Patton Boggs LLP announced that its mortgage group has teamed up with The Collingwood Group LLC.
In a telephone interview, a Patton Boggs partner noted that right out of the gate the two firms hope to help mortgage firms tackle the Federal Reserve Board's loan originator compensation rule.
Other issues the alliance is expected to deal with are risk retention and the Fed's proposed payment ability requirements under Regulation Z.
COFI Falls for 9 Straight Months
The Cost of Funds Index was 2 basis points lower in March than in February, the Federal Home Loan Bank of San Francsico reported.
COFI has been lower each month since June 2010.
A year ago, the index was 41 BPS higher.
New Activity Edges Higher as Rates Slip
The U.S. Mortgage Market Index from Mortech Inc. and MortgageDaily.com was 203 for the week ended Friday.
The index was higher than 198 a week earlier.
Driving the improvement were mortgage rates, with the 30-year falling 5 basis points.
HUD $100 Down In Effect
The Department of Housing and Urban Development is selling properties that require a cash investment of only $100.
The deal applies to HUD's real-estate-owned properties, according to a mortgagee letter.
Borrowers can get into the property as long as they qualify for a mortgage that is insured by the Federal Housing Administration.
Defiant Foreclosure Lawyer Won't be Stopped by Lost License
The California State Bar Court suspended the law license of a controversial lawyer.
In a scathing 15-page opinion, the judge berated the attorney for acting as if he were a modern-day Henry David Thoreau, encouraging civil disobedience to achieve social benefits.
The attorney allegedly advised one California couple to break into their foreclosed home. They did, only to be evicted later, causing prospective purchasers to back out of the sale.
M.I. Volume Bounces
Mortgage insurance policies written in February were the lowest on record based on an analysis of Mortgage Insurance Companies of America data back to 2000.
But the trade group said its members reported a gain for March.
Last month's volume worked out to over 18,000 policies issued for more than $4 billion.
Rates Ease, Could Hold
A 2-basis-point improvement over last week was reported for the 30-year fixed-rate mortgage by Freddie Mac.
The 30-year was 28 BPS below the same week in 2010.
Based on the 10-year Treasury yield, mortgage rates are likely to come in near the same levels next week.
New GSE Servicing Guidelines Out by September
Mortgage servicing guidelines at Fannie Mae and Freddie Mac will be aligned under a directive issued by their regulator.
Under the revised framework, servicing requirements and monetary incentives will become uniform between the two secondary lenders.
The changes are being made in conjunction with recent settlement between federal regulators and the nation's largest mortgage servicers.
Fannie Holds Delinquency, Secondary Volume
March's new business acquisitions at Fannie Mae inched up nominally from February.
But business was down 30 percent from March 2010.
Fannie said February residential delinquency of at least 90 days came in a basis point better than in January.
FHA Purchases Soar
The volume of purchase endorsements shot up 22 percent from February, the Federal Housing Administration said in its monthly operational report.
New purchase applications received by FHA shot up 48 percent from the prior month.
But more recent indicators suggest FHA purchase activity has taken a sharp turn down.
Fairway Business Down Over Half
First-quarter retail originations were down around 50 percent from the fourth-quarter 2010 at Fairway Independent Mortgage Corp.
Compared to the first-quarter 2010, production was off around 14 percent.
But Fairway reported strong growth at its recently launched wholesale lending division.
Citi Cutting 100s of Production Jobs, Hirings 100s in Servicing
Around 400 jobs are being eliminated at CitiMortgage Inc.
The impacted jobs are in loan production.
But the company also plans to hire 500 servicing employees in response to a recent settlement with banking regulators.
Flagstar Originations Down By Nearly Half
Residential originations at Flagstar Bancorp Inc. were nearly $5 billion, according to first-quarter earnings data.
Volume sank from more than $9 billion closed in the prior period.
Business is likely to continue to decline, with mortgage rate lock commitments falling 38 percent from the fourth quarter.
Compliance is Top Issue in LOS Development
Loan origination system provider Dorado Corp. recently predicted that government oversight will remain active, especially with mortgage brokers, and mortgage compliance will remain center stage.
Loan-officer-compensation functionality has been added to OpenClose's LenderAssist, an announcement indicated.
An integration between Avista Solutions and FHA Connections gives FHA-approved lenders direct access to the Department of Housing and Urban Development's FHA loan origination functions, a statement said.
Bank Execs Promoted, Recruited and Released
John Harvey is at the helm of Wells Fargo Bank International as chief executive officer after serving on interim basis.
TD Bank has a new regional president, Rob Hoak, for the South Carolina and Wilmington, N.C., markets.
SunTrust Banks Inc. recently appointed Kevin Blair as its Georgia region chairman, president and CEO.
Legendary CEO Warns About QE2
The former chief executive officer of General Electric Co., Jack Welch, is warning that the Federal Reserve's "Quantitative Easing 2" program will eventually cause a major economic "blowout."
He warned that the program "just puts more money into the system" with no risk to Wall Street.
"With free money ... something's going to blow here -- and blow big," Welch stated.
CA Firm Acquires FHA Lender, Plans Hirings
Residential Wholesale Mortgage Inc. announced the acquisition of the Government Loan Center.
The acquired company originates and underwrites loans that are either insured by the Federal Housing Administration or guaranteed by the Department of Veterans Affairs.
Up to 15 new loan originators and some additional support staff are expected to be recruited by the end of this year.
Bidding Ends Soon on Agency Servicing Portfolio
MountainView Servicing Group is marketing a $262 million servicing portfolio.
The mortgages are being serviced for Fannie Mae.
Bids are being accepted until April 28 at noon Eastern Daylight Time.
PMI Loosens Requirements in Distressed Markets
PMI said it is raising the maximum loan-to-value ratio to 95 percent on purchase transactions in distressed markets.
The higher LTV is available to borrowers whose credit scores are at least 720.
The increased LTV also applies to rate-term refinances.
$100 Million Fraud Case Yields 7 Sentences
Seven people were sentenced to federal prison recently for their roles in Waxhouse mortgage fraud case that involved high-end neighborhoods in North Carolina's Mecklenburg and Union counties.
A U.S. District Court judge last week handed down one of the stiffest penalties so far to Clinton Bruce Darden, a Rock Hill appraiser who owned ValuEstimators Inc., according to court documents.
Darden was given 33 months in federal prison.
Improving Delinquency Trend Developing at Freddie
At $26.9 billion, March purchases and issuances were 31 percent lower than in February.
Compared to a year earlier, volume was down 13 percent.
Freddie said first-quarter activity totaled $104.7 billion.
The Credit Report
A Federal Trade Commission report to Congress discussed the consumer protection agency's study on credit report accuracy.
Mortech Inc. said that an instant-access, credit-reporting-agency connectivity portal has been created for it clients.
Survey results reported by Mortgage Marval indicated that the national average credit score was 735.
More Good News for CRE as Government Support at 36%
A preliminary estimate in February from the Mortgage Bankers Association indicated that the origination of commercial real estate loans during 2010 was expected to add up to $110 billion.
In 2009, that number was just $82.3 billion.
But on Monday, the Washington, D.C.-based trade group upped last year's volume.
Investor Seeks Non-Performing Notes
A San Francisco-based buyer of mortgage notes is now acquiring non-performing loans.
The program was announced Saturday by Amerinote Xchange llc.
The official launch is in May.
Chase Hiring Up to 1,000 in Ohio
JPMorgan Chase & Co. is looking to add between 500 and 1,000 mortgage-servicing jobs in Ohio.
The staff expansion will help the company deal with issues brought up in a recent settlement between the biggest mortgage servicers and federal regulators.
But the jobs aren't expected to last more than a couple years.
Senate Report Analyzes WaMu's Downfall
A 650-page report released by the U.S. Senate's Permanent Subcommittee on Investigations outlines the collapse of Washington Mutual Bank.
WaMu's loan sales were concentrated in Florida, which ultimately suffered above-average home value depreciation.
Option-ARMs and no-income-verification also played a big role in the bank's demise.
Low VA Bank Failure Rate Could Change
When the Federal Deposit Insurance Corp. discloses on some Friday evenings which of the nation's faltering banks failed, it's rare to hear of any from Virginia.
In fact, only two Virginia financial institutions have failed since 2000.
The few failures, however, mask growing financial pressure on several of Virginia's community banks.
Repurchases Lead to Resignation of Bank CEO
The founder, chairman and chief executive officer of First Mariner Bancorp has agreed to resign as part of a tentative deal to secure a desperately needed cash infusion.
Losses started at a Northern Virginia division that started making no-income verification mortgages.
"It started off as a trickle, and it became a torrent," the departing chief said of resulting repurchase demands.
Mortgage Portfolio Grows at 5/3
Fifth Third Bancorp owned $9.5 billion in residential loans as of March 31, according to its quarterly earnings data.
The portfolio grew from $9.0 billion at the end of last year.
The portfolio was also higher than a year earlier, when it stood at $7.9 billion.
Purchase & FHA Activity Tumbles
The U.S. Mortgage Market Index from Mortech Inc. and MortgageDaily.com for the week ended April 22 was 7 percent lower than last week.
Pulling down business was new activity on loans insured by the Federal Housing Administration.
Purchases were also slower.
Secondary Marketing Tools
The IRESE Exchange promises to provide an Internet-based, government-regulated exchange market where mortgage bankers can securitize their loans.
FinalCheck seeks to decrease rejections and buybacks.
APF Advisory Services offers loss recovery and surveillance services for sellers and holders of mortgage-backed securities, collateralized-debt obligations and other mortgage-related securities. |
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