Mortgage Daily Logo

GSEs Need Better Monitoring of Servicers

Mortgage News

The Federal National Mortgage Association and the Federal Home Loan Mortgage Corp. need to more closely monitor servicer compliance with their requirements, according to a new government report.

Fannie Mae and Freddie Mac servicers did a poor job responding to the surge in delinquencies brought on during the financial crisis.

Servicers often failed to assist distressed borrowers in obtaining loan modifications through government-sponsored enterprise programs.

The poor handling of distressed borrowers led to the unnecessary loss of homes.

The deficiencies were covered in FHFA’s Oversight of the Servicing Alignment Initiative from the regulator’s Office of Inspector General.

“Moreover, the enterprises themselves likely incurred additional losses due to their servicers’ failure to execute consistently their contractual responsibilities with respect to delinquent borrowers,” the report said.

FHFA established a Servicing Alignment Initiative in April 2011 to improve servicer performance and reduce GSE losses.

But the OIG said it found that monitoring of compliance with the initiative has been limited.

The FHFA unit assigned with the primary responsibility of overseeing the initiative and servicer compliance, FHFA’s Division of Housing Mission and Goals, has not reviewed or evaluated overall servicer compliance since the program was established in 2011.

In addition, the GSEs are not required to routinely submit critical reports on servicer compliance. So the FHFA division hasn’t determined if servicers are complying with the initiative.

The OIG recommends that an ongoing process is established to evaluate servicer compliance and the effectiveness of remediation efforts by the GSEs.

The inspector general is also calling on FHFA to direct Fannie and Freddie to routinely provide internal reports and reviews for assessment.

In addition, the OIG wants the FHFA to regularly review initiative guidelines for enhancements or revisions based on servicers’ actual versus expected performance.

Related Posts

NewDay USA CEO Rob Posner Expects 10% Increase in 2019 Mortgage Loan Volume

There is No Such Thing as a Free House …

Over the past several years, those who service loans in the State of Washington(1) have seen a dramatic rise in the number of lawsuits in which delinquent borrowers seek to quiet title to their homes on the grounds that lenders are barred from foreclosing based on...

NewDay USA CEO Rob Posner Expects 10% Increase in 2019 Mortgage Loan Volume

The Mortgage Graveyard 2018 Archives

The Mortgage Graveyard 2018 Archives Failed, Struggling and Acquired Mortgage-Related Companies Non-Bank Closures 3 Bank Failures (FDIC) 0 Credit Union Failures 0 Total Mortgage-Related Failures 3  

NewDay USA CEO Rob Posner Expects 10% Increase in 2019 Mortgage Loan Volume

MBS Statistics

MBS Statistics Non-Agency Issuance 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 Private Label RMBS Issuance (S&P) $80 billion to $100 billion (est) $70 billion $34...

NewDay USA CEO Rob Posner Expects 10% Increase in 2019 Mortgage Loan Volume

Sample E-Mail

Sample E-Mail   Covering the Real Estate Finance Since 1999  Mortgage Industry News free news content | view headlines online  Advertorial Text Ad This ad includes a linked bold headline of up to 50 characters and up to 100 words of text. The ad can be...

Popular posts

How Long Does It Take to Refinance a Mortgage
How Long Does It Take to Refinance a Mortgage

So, you’re interested in refinancing your mortgage. Maybe you want some extra capital to do that home project you’ve always dreamed of, interest rates are nearing record lows, or you want to start consolidating debt. Regardless of the motivation behind the refinance,...

How Does Refinancing a Mortgage Work
How Does Refinancing a Mortgage Work

A home purchase is considered an investment, and a robust one at that. Savvy owners are constantly looking for new ways to reduce debt, save money, pay less in interest, and ultimately build equity. Refinancing is one way to leverage your investment and do just that....

What Does It Mean to Refinance Your Home
What Does It Mean to Refinance Your Home

You can think of refinancing your mortgage as a debt redo. Essentially, you’ll swap out the existing loan for a new one - ideally with better terms and conditions. Only this time it could help you save money on high mortgage payments, rather than just borrow it....

Setting up the Utilities in My New House
Setting up the Utilities in My New House

All the tedious, time-consuming home closing documents have been signed, sealed, and delivered. Your belongings are packed into what seems like a million boxes and you have a solid plan to haul all your existing furniture to the new place. Just as your boxes and...

When Is My First Mortgage Payment Due?
When Is My First Mortgage Payment Due?

Navigating your way through a brand new mortgage loan can be a difficult task, especially for first time homeowners. After handing over a large sum of money for the down payment and closing costs, it’s important to pay attention to the timing of your first mortgage...

Newsletter

Don’t worry, we don’t spam

calculate your monthly mortgage payment

Related Topics

Helpful Links

Daily mortgage rate trends

Best mortgage lenders

First-time homebuyers programs by state

Loan limits by state

Types of mortgages

APR vs interest rate

Understanding PMI