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MortgageChronicle.com Archives
week ended Dec. 31, 2010
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Record Low for Mortgage Market Index
The Mortech-Mortgage Daily Mortgage Market Index was 140 for the week ended Dec. 29.
The index was 205 seven days earlier.
The Mortgage Market Index has never been this low since launching on Dec. 17, 2009.
FL LOs Given More Time for NMLS
The Florida Office of Financial Regulation announced an extension of time for loan originators to complete their applications under the Nationwide Mortgage Licensing System.
The deadline had previously been set for Dec. 31.
However, in a news release the department said that LOs would now have until March 31, 2011.
1.5 Million Modifications Since 2008
From the beginning of 2008 through the middle of this year, 1.5 million modifications were completed by banks and thrifts, the Office of the Comptroller of the Currency reported.
Third quarter permanent loan modifications were 233,853.
Driven by a sharp drop in Home Affordable Modification Program activity, the volume of all modifications was off 13 percent from the prior three-month period.
New Penn Originates Over $1 Billion
New Penn Financial LLC originated $1.1 billion during this year.
Business was up 22 percent from 2009.
Next year, the company will overcome a drop in refinance business by expanding its traditional retail presence and community bank channel.
FL Lender Sees 67% Growth
Foundation Financial Group has made more than $300 million in mortgage loans this year.
The Jacksonville, Fla.-based mortgage lending company has about 300 employees.
Foundation hopes to do $500 million in originations during 2011.
Moral Hazard High for Strategic Defaults
Some borrowers are deciding to default, even if they have the abity to pay, a study from Old Dominion University suggests.
"The neighbor who is paying the mortgage finds out about their neighbor who isn't, and it creates something called the moral hazard problem," one of the researchers said.
"The paying neighbor asks himself why he should continue paying his mortgage when his neighbor stopped paying a year ago and nothing bad has happened to him."
Quicken, PrimeLending Sued by Employees
In Henry vs. Quicken Loans, the lender is accused of violations of law for unpaid overtime compensation to mortgage bankers.
Nichols Kaster PLLP, the attorneys in the case, have also filed several cases in the past three months alleging unpaid overtime wages for mortgage industry workers.
Among them is a lawsuit filed against PrimeLending.
Affidavit Probe Expected to Be Done in 2011
A working group of attorneys general and banking officials from all 50 states has been gathering evidence in its probe of potentially improper or illegal lending and servicing practices.
The group, led by Iowa's attorney general, has met a number of times with representatives of five top mortgage lenders and servicers.
The group expects it will reach conclusions in its probe in 2011.
Break for First Magnus Execs
A bankruptcy judge has thrown out claims of corporate pilfering against former executives and directors of failed mortgage lender First Magnus Financial Corp.
The decision came after the attorneys making them failed to meet filing deadlines to back up their arguments.
This latest decision was largely made on procedural grounds.
Class Action Filed Over HELOC Subordination Fees
A federal lawsuit has been filed by an Ohio attorney against The PNC Financial Services Group Inc.
The complaint alleges that the bank breached a contract with the attorney when it charged her a $135 fee to subordinate its home-equity line-of-credit to the first mortgage she refinanced.
Class-action certification is sought in the case.
Ally Settles Repurchase Obligations on $84 Billion in Loans
Ally Financial Inc. disclosed that it reached a settlement agreement with Fannie Mae.
The deal impacts all mortgages serviced by GMAC Mortgage LLC on behalf of Fannie as of or before June 30.
Securitizations with unpaid balances of $84 billion are impacted by the agreement.
Repurchase Litigation Ledger
A federal lawsuit was filed by Lehman Brothers Holding Inc. against Nationsfirst Lending Inc. alleging that the company failed to honor various contracts requiring the repurchase of faulty mortgage loans.
A lawsuit filed by Universal Mortgage Corp. against Wurttembergische Versigh alleges that the defendant reneged on a mortgage bankers blanket bond.
MBS investors filed a putative class action against Countrywide Financial Corp. alleging that parent BofA was not justified in denying $352 billion in repurchase demands.
HUD Takes Actions Against Hundreds of Lenders
The Department of Housing and Urban Development disclosed that it took actions against 27 FHA mortgagees for a variety of reasons including failing to notify the agency of major company changes, abusing government logos and not properly supervising employees.
HUD said that 127 mortgagees failed to meet annual recertification requirements and lost their FHA approval for one year.
Another 88 mortgagees failed to meet annual recertification requirements but subsequently cured the deficiencies.
3 FHA Mortgagees Pay HUD $1.7 Million
The U.S. Department of Housing and Urban Development disclosed that WR Starkey Mortgage LLP was hit with a $223,000 civil money penalty.
Countrywide Home Loans Inc. entered a settlement with HUD that included a $141,500 civil money penalty and buy downs of $93,263.
HUD accepted an $815,913 settlement offer from Birmingham Bancorp Mortgage Corp.
Broker Says What Banks Can't
Connecticut mortgage broker Mark Ballaro said he's not sure restitution should be paid by Wells Fargo & Co. to all pick-a-payment borrowers.
He said monthly statements told people how much they owed and if they were falling behind.
"If the banks are culpable, the attorney who represents the buyer is culpable, too, if he didn't explain it," Ballaro said.
Rates Improving
The average 30-year fixed-rate mortgage eased 2 basis points from last week in Freddie Mac's Primary Mortgage Market Survey for the week ended Thursday.
The 30-year was 24 BPS better than the same week last year.
Mortgage rates are likely to be lower in the next set of rate reports based on the 10-year Treasury yield.
Fannie Adjusts Pricing
Fannie Mae has updated its pricing on mortgages with loan-to-values in excess of 70 percent.
The updates were dislcosed in a lender announcement.
Mortgages with subordinate financing and LTVs at or below 65 percent will also now face loan-level price adjustments.
Fannie Outperforms Freddie
Fannie Mae's book of business ended November at $3.2 trillion, higher than the end of the prior month.
At the same time, rival Freddie Mac reported that its total mortgage portfolio fell.
Residential delinquency of at least 90 days was down 4 basis points during the most recent month at Fannie while Freddie reported an increase of 2 BPS.
Best Month of Year at Freddie
Freddie Mac reported $46 billion in purchases and issuances during November.
Business jumped from $40 billion a month earlier.
In fact, it was the best month of the year for Freddie.
Bright Outlook for Defaults
The risk of default on residential loans fell again this quarter, according to the UFA Default Risk Index.
The index measures the risk of default on newly originated prime and nonprime mortgages.
It was the lowest level in more than five years for the index.
Bank Acquisitions Continue
Berkshire Hills Bancorp Inc. announced an agreement to acquire Legacy Bancorp Inc.
Caja de Ahorros de Valencia, Castellón y Alicante, Bancaja and Banco Financiero y de Ahorros, S.A., both of Spain have received final approval from the Federal Reserve Board to acquire CM Florida Holdings Inc.
TowneBank completed The Bank of Currituck acquisition, according to a company press release.
New Business Falls as Rates Continue Rising
The Mortech-Mortgage Daily Mortgage Market Index rose to 205 for the week ended Wednesday from 221 a week earlier.
The 30-year conforming mortgage rate increased to 4.961 percent from 4.906 percent last week.
The jumbo-conforming spread widened to 78 basis ponts from last Wednesday's 73 BPS.
Rise In Delinquency Might Be Temporary
In the latest report from Standard & Poor's and Experian, residential first-mortgage delinquency of at least 90 days climbed 14 basis points.
It was the first time delinquency has risen since December 2009.
But the deterioration in mortgage lates might only be temporary according to the managing director and chairman of the index committee.
FHA Performance Sinks
Despite an uptick in closed loan volume during November, new FHA applications fell 20 percent from October.
The turnaround process for FHA loans deteriorated to 7.3 weeks from application to closing, longer than the 6.9 weeks it took to close a loan in October.
Delinquency was up 70 basis points during the latest period.
BofA Leads Monthly HAMPs Higher
During just last month, 21,306 permanent HAMP modifications were completed, up from 16,634 in October, according to data from the Department of the Treasury.
Bank of America, N.A., saw HAMP volume jump to 4,420 in November from the previous month's 434.
The activity made it the biggest HAMP producer of the month. |
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Broker Says What Banks Can't
When it comes to assigning blame for the mortgage crisis, many are quick to point the finger at banks. And although responses from such financial institutions are limited to diplomatic statements -- a Connecticut mortgage broker is a little more blunt in his assessment that borrowers were a big part of the problem.
While they had the same loans and encountered some of the same disastrous results, Connecticut residents who lost homes to foreclosure after taking out World Savings or Wachovia "Pick-A-Payment" mortgages don't have the same access to restitution funds as residents of some other states.
Wells Fargo & Co., which now owns Wachovia, has reached agreements with 10 states to offer modifications to homeowners with Pick-A-Payment loans and to establish funds to help those who already lost their homes to foreclosure.
MortgageDaily.com subscribers read full story
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Wells Closes Wholesale Center
A wholesale unit located in Northern California will be closed down by Wells Fargo & Co., and, as a result, more than a hundred jobs will be eliminated. But the company says it is still committed to the mortgage broker channel.
The wholesale lending work currently being done in Concord, Calif., will be shifted to the Orange County city of Irvine, Calif.
San Francisco-based Wells Fargo will eliminate 137 jobs in Concord from its home mortgage operations.
MortgageDaily.com subscribers read full story
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Proposal Has Lenders, Brokers Filing SARs
A proposal from the Department of the Treasury would require more than 30,000 mortgage brokers and non-bank mortgage lenders to file Suspicious Activity Reports with the Financial Crimes Enforcement Network when mortgage fraud is suspected. Mortgage bankers have thrown their support behind the proposal.
The Obama administration introduced the proposal on Monday that would require independent mortgage lenders and mortgage brokers not affiliated with banks to file reports when fraud or money-laundering schemes are suspected.
Much like other institutions, the lenders would be required to set up anti-money-laundering programs and report suspicious transactions.
MortgageDaily.com subscribers read full story
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Jan. 1 License Deadline for CA LOs
California loan originators who work for mortgage bankers and mortgage brokers will need to be licensed and listed in the national registry come Jan. 1, 2011. Around 19,000 originators have met licensing requirements so far, while roughly 18,000 people are still working on it.
The new licensing rules for mortgage brokers take full effect on Jan. 1 and aim to prevent some of the fraud and abuse that helped cause the subprime mortgage crisis.
Brokers and mortgage bankers will now have to be licensed and listed in a searchable federal database in order to take residential mortgage applications or negotiate loan terms. The law exempts those who work for banks that take customer deposits.
MortgageDaily.com subscribers read full story
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Oregon Brokers, Appraisers Exit
The housing crisis has cost the Oregon real estate industry many jobs, with the number of licensed mortgage brokers in the state falling by more than half since 2006. The number of appraiser apprentices has plummeted 71 percent during the past four years.
Relentlessly negative housing sales figures for Lane County, Ore., continued in October, leaving few workers in the broad-based real estate industry untouched.
Hundreds of local real estate agents, appraisers, inspectors, escrow officers, mortgage brokers and builders have lost jobs in the past three years.
MortgageDaily.com subscribers read full story
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