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Mortgage Industry News Headlines
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Last Updated Friday, November 20, 2009 03:58 PM CST
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Big Shakeup Among Ranks of Top-10 Lenders
An analysis by MortgageDaily.com of home loan production indicated that overall residential volume was 22% lower in the third-quarter than in the second quarter. Bank of America Corp. unseated Wells Fargo & Co. as the biggest lender. Citigroup, which had ranked as the fourth biggest lender in the prior report, saw volume tumble by more than half -- the largest quarterly decline among the 10 biggest lenders -- leaving it as the sixth biggest lender in the third quarter.
Banks & Individuals Face Regulatory Actions
The Federal Reserve Board issued a Prompt Corrective Action Directive against Orion Bank. Formal agreements were reached between 11 institutions and their respective regulators. The National Credit Union Administration Board announced that prohibition orders were issued against six individuals.
The Mortgage Insurance Insider
Radian recently reported rate changes and indicated that delegated lenders must underwrite all loans before ordering mortgage insurance. But high-risk and exception loans can be submitted to Radian's service center for non-delegated underwriting. United Guaranty issued an announcement indicating its guidelines were updated to reflect previously announced changes policies for condominium, renovation, refinance and modification transactions. PMI Mortgage Insurance Co. said in a quarterly distressed markets policy update that four metropolitan statistical areas were removed from the distressed markets list.
TILA Rule Applies to Individual Investors
The Federal Reserve Board published an interim final rule on the Truth-in-Lending Act. The rule requires that a notice be sent to the borrower when ownership of a mortgage changes hands. Individual investors who acquire more than one loan a year are subject to the rule.
CA Bank Jumps to $3 Billion in '09 Originations
Fremont Bank reported more than $3 billion in residential production so far this year. Volume is more than three times the level reached for all of 2008. The bank operates from Fremont, Calif.
Decade-Low Purchase Activity Despite Record 15-year
The average 15-year fixed-rate mortgage dropped 8 basis points from last week in Freddie Mac's latest Primary Mortgage Market Survey. It was a record low for the shorter-term mortgage based on data back to 1991. But loan applications for home purchases fell to their lowest levels in more than 10 years, according to the Mortgage Bankers Association's lastest weekly survey.
Record Lates to Head Higher
Residential delinquency of at least 30 days, including foreclosures, shot up 1.25 percent in the Mortgage Bankers Association's third-quarter National Delinquency Survey. It was "the highest ever recorded" based on MBA data back to 1972. MBA's chief economist predicted that "delinquency rates and foreclosure rates will continue to worsen before they improve."
HUD Eases FHA Appraisal Requirements
The U.S. Department of Housing and Urban Development issued a mortgagee letter on high-balance loans insured by the Federal Housing Administration. HUD said it will no longer require second appraisals on high-balance mortgages in declining markets. The update is effective immediately.
DocMagic Scores Win in Case Against Ellie Mae
DocMagic Inc. originally filed two lawsuits against Ellie Mae Inc. in August. One of the cases was filed in a state superior court. Ellie had tried to have the superior case dismissed, but a judge denied its request.
Education Firms Tackle S.A.F.E. Requirements
AllRegs announced that James B. Nutter & Co. successfully completed its 20-hour Mortgage Loan Originator SAFE Comprehensive Course. AllRegs said it was approved by the Nationwide Mortgage Licensing System & Registry in August. ProSchools said in July that it received NMLS approval. Another firm to recently announce NMLS approval was TrainingPro.
Second Lien Underworld
Combined loan-to-values on outstanding residential mortgages are higher than many believe, a report from Equifax Capital Markets said. The study examined non-agency securitized mortgages from the third-quarter 2005 to the third-quarter 2009. Under-reported second mortgages are at the heart of the distorted view.
Dallas Firm Earns IBM Award
The IBM Information Management Solution Excellence Award was presented to Imagine Solutions, an announcement from Imagine said. Imagine won the award for its paperless mortgage lending solution, the news release stated. The mortgage technology provider claims its solutions have cut per-loan processing costs to about $85.
Comptroller Calls for Underwriting Standards
Comptroller of the Currency John C. Dugan identified three underwriting standards that should be mandated for U.S. residential lenders. "When underwriting standards get so out of balance that they cause widespread damage to borrowers and lenders alike, it becomes necessary for regulators to act more prescriptively," Dugan said in the statement. He was speaking at an event in Tokyo.
Inside Foreclosure Litigation
A class action filed in Minnesota federal court against U.S. Treasury Secretary Timothy F. Geithner, Fannie Mae and Freddie Mac and several servicers has been dismissed. The case alleges that the plaintiffs were denied access to the Home Affordable Modification Program. A motion for a preliminary injunction was denied. The Law offices of Kaufman, Englett and Lynd LLC announced that it now represents borrowers in California lawsuits that capitalize on violations of the Truth-in-Lending Act, violations of the Real Estate Settlement Procedures Act and predatory lending practices.
States Battle Foreclosure Firms
Florida's attorney general announced that a lawsuit was filed against National Payment Modification Co. and related defendants. The companies allegedly charge up to $2,500 in up-front fees. The Texas attorney general announced that an agreed temporary injunction was signed by Dallas County 134th District Judge James M. Stanton against Markus Bailey and Tyrone Bailey. They allegedly charged up-front fees of at least $1,000 but "provided no measurable foreclosure relief.
Refinance Production Jumps
Fourth-quarter refinance originations are projected increase 32 percent from the third quarter, Fannie Mae said in an economic forecast. Refinance share of originations is predicted to rise to 62 percent. Overall fourth-quarter origination are expected to come in 18 percent higher.
Firm Abandons Mortgage Lending for Energy
Freedom Financial Mortgage Corp. will end mortgage operations by the end of the year, according to an announcement from the company's parent. Also impacted by the decision is Freedom Mortgage Resolutions Inc., a spokesman told MortgageDaily.com. The chief executive officer of the parent firm explained that the company will focus on the energy sector.
Federal Agencies Issue Model Privacy Form
The Final Model Privacy Notice Form was released by eight federal regulatory agencies. The form is expected to make it easier for consumers to understand how financial institutions collect and share information about them. The agencies were required to provide a model form under an amendment to the Gramm-Leach-Bliley Act.
Record Delinquency, But Rate of Increase Eases
Mortgage delinquency of at least 60 days rose 44 basis points between the second and third quarter, TransUnion reported. The level of late payments was the highest ever. But TransUnion noted that the rate of increase slowed.
Several American Home Servicer Ratings Upgraded
American Home Mortgage Servicing Inc.'s primary servicer rating for prime mortgages and Alt-A loans was upgraded, Fitch Ratings announced. Fitch also upgraded the servicer's primary servicer rating for subprime loans. In addition American Home's primary specialty servicer rating for closed-end seconds was upgraded.
GMAC Replaces CEO
GMAC Financial Services' chief executive officer has resigned, the company announced. He originally joined GMAC in 2007. Michael A. Carpenter was named and GMAC's new CEO.
PMI Expands LTVs, Guidelines
PMI Mortgage Insurance Co. raised loan-to-values in non-distressed markets, according to a bulletin. Condominium LTV have been raised to 95 percent. PMI said it will begin allowing exceptions to its flip policy next year.
Fed Approves Servicing Transfer Rule
The Federal Reserve Board approved the interim final rule that requires borrowers be notified when their mortgage loan has been sold or transferred, according to a news release. The rule was part of legislation enacted earlier this year. The interim final rule is effective upon publication, the fed said.
National City Mortgage Brand Gone
A press release indicated that the National City Mortgage brand has been retired. The PNC Financial Services Group Inc. acquired National City's parent company late last year. The former lending unit now operates as PNC Mortgage.
Regulation to Intensify
Under Obama administration, financial regulators have gained a sense of empowerment, Wolters Kluwer Financial Services reported. But that empowerment will likely translate into "a broad array of new rules and agencies, as well as stepped-up enforcement actions in 2010." The changes are already taking place, with new legislation tied to regulatory reform being debated by Congress, the firm said.
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