Mortgage Nuts and Bolts: Duration Risk and HELOC Resets, Burkey Loan, Servicing is Cheap, Negotiating Broker’s Fee, Rick Sharga 5 Questions

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(duration risk and HELOC resets) The Hidden Bank Time Bomb: Interest Rate Risk – Yves Smith – … Tom Adams added another cheery thought via e-mail: There is also a coming problem for HELOC borrowers – these loans will reset from interest only payments to principal and interest payments in the not too distant future. The HELOC interest only period was typically around 10 years, so that would put the reset dates in 2-3 years for a big chunk of bank portfolio HELOCs.  … – Naked Capitalism
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(The Burkey Loan) Carpe Aquam Capital Develops No Cost Solution for Housing/Mortgage Crisis – Press Release: Carpe Aquam Capital LLC – Yahoo Finance

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(this is great) The Opportunity In Mortgage Servicing Rights – Lane Olafson – Seeking Alpha 
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(consumer info) Good Luck Trying to Negotiate Mortgage Broker’s Fee – Jack Guttentag – “I refinanced last year and negotiated the fee I paid the mortgage broker. Now, I want to refinance again to take advantage of lower rates, and my broker tells me that the arrangement we had last time is no longer possible under new rules. He says that his fee is set beforehand and that there is no way he can change it. That fee would be twice as much as I paid him last time, and may change my mind about doing the deal. Is he being straight with me?” … more – The Mortgage Professor

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(answers 5 questions) Rick Sharga Considers The Changing State Of Mortgage Banking – by Phil Hall – MortgageOrb

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Government and Fed Affecting Housing: Sheila Bair, GSEs, Supreme Court, Bernanke Words, Senate on HARP, Freddie Portfolio, Bernanke’s Future

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Former FDIC Chairman Bair Warns Fed Fueling Bubble – By Kristina Peterson – … in an op-ed published Monday on Fortune magazine’s website. Bair, who locked horns at times with top Fed and Treasury officials during the financial crisis, warned Monday that the central bank runs the risk of helping drive Treasury bond prices up too high, potentially creating an asset bubble in bonds. … – WSJ Blogs
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Fannie Mae, Freddie Mac Likely To Live On Despite Government Criticism – By Margaret Chadbourn – (Reuters) – In considering how to fix the ailing U.S. housing market, Republicans and Democrats in Washington have found a rare point of agreement: they would prefer life without failed mortgage giants Fannie Mae and Freddie Mac. But even with agreement that the system is broken, it is unlikely Congress will soon tackle the mammoth task of winding down two entities that have cost taxpayers more than $150 billion since their bailout in September 2008. Fannie and Freddie now support about 60 percent of all new U.S. home loans. – Huffington Post

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Supreme Court disappoints landlords, rejects rent-control challenge – By David G. Savage – The Supreme Court on Monday rejected a constitutional challenge to New York City’s famed rent-control ordinance, a post-World War II housing measure that limits the rents of more than a million apartments. – LA Times

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Ben Bernanke Just Said The 5 Magic Words – Joe Weisenthal and Simone Foxman – … The other answer: "We’re prepared to do more." The Bernanke put lives! … – Business Insider
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More Refinance Help on Horizon for Fannie, Freddie Homeowners? – … The draft bill discussed at the "Helping Responsible Homeowners Save Money Through Refinancing" hearing at Wednesday’s meeting of the Senate Subcommittee on Housing, Transportation, and Community Development, would allow borrowers with loans backed by Fannie Mae and Freddie Mac to refinance their mortgages more easily to take advantage of rock-bottom interest rates. … – US News

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(home court advantage) Senate concerned HARP restricts mortgage servicer competition – By Jon Prior – Leaders of a Senate banking subcommittee … Concerns arose over how recent changes to HARP pushed more refinancing business to the largest banks, allowing them to charge higher fees to borrowers. … (FHFA)  allowed the current servicer on the loan to avoid new representation and warranty risk … If a borrower went to a new servicer, … the rep and warrant risk would still transfer. This allows the original bank, which is usually one of the big four to charge the borrower a higher rate than they normally would have … – details – Housingwire
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Freddie Mac mortgage portfolio shrinks in March – By Justin T. Hilley – … released its March 2012 monthly summary showing that its mortgage portfolio contracted at an annualized rate of 2.9% in the month, while loan modification and delinquency rates held steady. The GSE continues its action toward shrinking its presence in the mortgage market after it reduced its portfolio by 3.3% in February and 4.8% in January. … – Housingwire
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Ben Bernanke and what the Federal Reserve does next – Lonesome dove – … That is a pity because while it was great theater, it obscured a more important revelation. Not only is Mr Bernanke still a dove, he is increasingly an isolated dove, and that isolation has significant consequences for monetary policy, the economy and the markets. … The second problem is that even if Mr Bernanke’s views prevail while he remains chairman, the odds are that he no longer will be after January, 2014. He is unlikely to be reappointed even if Barack Obama is re-elected (even if wanted the job, a big if, he probably couldn’t be confirmed), and certain not to be if Mitt Romney wins. So someone else will make the call on when to start tightening. … -  Economist 

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14 Posts About Home Prices: Jeff Gundlach Presentation, FHA Defaults, Actual vs. Pending Home Sales, Drop More?, Karl Case, Chicago, Zillow, Mark Lieberman, CR Says Bottom, Las Vegas, Case-Shiller, Price To Rent, Distressed Weighs Down, Phoenix, South Florida

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GUNDLACH: This Is Probably The Most Bullish Chart There Is For Housing – Joe Weisenthal – From Jeff Gundlach’s presentation yesterday. He said this chart of housing vs. gold is probably the most bullish chart there is for housing. – Business Insider
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(72 slides worth it) Here’s The Awesome Presentation That Jeff Gundlach Just Delivered To Investors At The New York Yacht Club – Business Insider

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Insight: Falling home prices drag new buyers under water – By Tim Reid – (Reuters) – More than 1 million Americans who have taken out mortgages in the past two yeas now owe more on their loans than their homes are worth, and Federal Housing Administration loans that require only a tiny down payment are partly to blame. That figure, provided to Reuters by tracking firm CoreLogic, represents about one out of 10 home loans made during that period. … raises the question of whether low-down payment loans backed by the FHA are putting another generation of buyers at risk. … Even for loans taken out in December – less than four months ago and the last month for which data is available – nearly 44,000 borrowers, or about 7.5 percent of the total, now find themselves under water. … 

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Actual home purchases are not keeping up with pending home sales – Sober Look Blog – … It shows that many pending transactions never make it to closing. The only explanation for this is the persistence of tight credit conditions in the housing market, with buyers unable to obtain adequate financing in order to close. This is in spite of record low mortgage rates. Within a month or two we should know if there have been improvements in the rate of closings. If so, we should see existing home sales pick up sharply. But given the recent history of the two indicators, this improvement is far from certain. …

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Will House Prices Drop Further? – Surly Trader Blog – The decline in housing prices seems never ending.  Prices have dropped for over 5 years and some still expect the bottom to fall out from here.  One simple way to approach housing prices is to compare them against inflation.  In this example, we will look at the Case-Shiller Composite-10 Home Price Index and the CPI Urban Consumers Index Seasonally Adjusted Less Food and Energy 
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Karl Case: American Dream of Home Ownership ‘is Just Gone’ – by Forrest Jones – The housing market is bumping along the bottom and due to improve but the American Dream of home ownership as most know it is “just gone” and becoming a thing of the past, says Karl Case, co-founder of the S&P/Case-Shiller Home Price Index. "We’re bouncing along a rocky bottom," Case tells Yahoo’s The Daily Ticker. – MoneyNews

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Chicago-area home prices continue slide in February – Chicago-area home prices down 6.9% in 2012 – By Mary Ellen Podmolik – Chicago Tribune
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(mixed bag) Zillow: Home Values Up 0.5% In March – by MortgageOrb.com – U.S. home values rose 0.5% from February to March, according to new data from Zillow. This marks the largest monthly increase in the Zillow Home Value Index (ZHVI) since May 2006, when home values also rose 0.5%. However, the ZHVI fell 3.1% year-over-year to $146,200. Zillow predicts that 19 of the 30 metro areas covered by the ZHVI will either reach a bottom this year or have already reached a bottom. … Nationally, Zillow is forecasting that home values will fall 0.4% over the next 12 months, …

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Home Prices Fall to Lowest Level Since 2002 – BY: MARK LIEBERMAN – The Case-Shiller Home Price Indexes fell for the sixth straight month in February, with the 10- and 20-city indices each dropping 0.8 percent from January, according to Standard & Poor’s. – The M Report

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(more thoughts from CR) The Bottom for House Prices – by CalculatedRisk
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Las Vegas home prices hit new post-recession low – By Steve Green – … Las Vegas prices fell 0.4 percent on a monthly basis and were down 8.5 percent from February 2011, S&P said. The declines compare to 0.8 percent on a monthly basis for the 20 big U.S. markets tracked by S&P/Case-Shiller; and a 3.5 percent year-over-year decline for the 20 markets. … – Vegas Inc

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S&P/Case-Shiller: Home prices in nine metros reach new lows – By Kerri Panchuk – Home prices fell to post-recession lows in the latest Standard & Poor’s/Case-Shiller national indices.  Home values in nine metro areas also reached record lows, the report said. S&P said its 10-city composite index experienced an annual home price decline of 3.6% in February, while the 20-city composite index declined 3.5% from a year earlier. – Housingwire ————
(charts too) Real House Prices and Price-to-Rent Ratio at late ’90s Levels – Calculated Risk
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Survey: High Share of Distressed Properties Keeps Prices Down – BY: ESTHER CHO – Inventory is shrinking and traffic for homebuyers seems to be increasing, but according to the Campbell/Inside Mortgage Finance HousingPulse Tracking Survey, home prices were down in March. One reason for this, according to the survey, which includes about 2,500 real estate agents, is the high number of distressed properties on the market. Home prices for non-distressed properties in March dropped 5.7 percent from a year ago in March 2011. Prices for damaged REO properties also saw a 5.7 percent decline in prices, while move-in ready REO prices fell 2.5 percent during the same period. Short sales declined significantly, with prices falling 14.3 percent during the one-year period. – more – DS News

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Pending South Florida home sales increase 13 percent in March – BY DAVE WILSON – MIAMIHERALD.COM – The latest report on pending home sales shows Miami-Dade and Broward counties surging by 13 percent in March compared to February but moving in different directions on a yearly basis.

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Home prices in Phoenix area up 20 percent in past 12 months – by Catherine Reagor – Arizona Republic – Home prices are surging in metro Phoenix, climbing 8 percent in March alone and 20 percent in the past 12 months.
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Mortgages and Housing: Maiden Lane III, Richard Cordray & Servicers, Bay Area Sales, Property Damage & DQs, Mortgage-Tax Break Curbed, Shadow Inventory, Asia Buying USTs, FOMC Steady, Cost of Twisting, New Graduates, Low-Ball Bids, Mods Improve, IL Home Prices, Short Sales at JPM

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Fed mulls Maiden Lane III asset sales – Reuters – Yahoo Finance
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Richard Cordray’s War On Mortgage Servicers – by Phil Hall – … in his capacity as the director of the Consumer Financial Protection Bureau (CFPB), Cordray has engaged in countless circular journeys that inevitably wind up at the same destination: Mortgage bankers are bad guys that must be punished. … Not since J. Edgar Hoover has there been a non-elected civil servant who wielded so much power with so little accountability. If I may, I would like to step into that void and offer a rebuttal to some of Cordray’s recent commentary. … – MortgageOrb

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Bay Area Housing Hits Five-Year High – by MortgageOrb.com – March 2012 home sales in the San Francisco Bay area were at their highest level for that month in five years, the result of lower prices, low interest rates and an improving economy, according to a new report by San Diego-based DataQuick.

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Property Damage For Delinquent Homeowners – Another Bureaucracy To Face – by Donna S. Robinson – If you are a homeowner struggling to keep your home, and experiencing the frustrations of dealing with a giant bank or government bureaucracy, storm damage to your home can take things to a whole new level. … When a borrower is delinquent on their mortgage, and then a tornado hits their house, the claim check for the damage will not be paid to the homeowner. The checks are arriving made payable to the the homeowner and their lender. That’s right, if you are behind on your mortgage, and you get hit by a tornado, you may spend weeks trying to figure out where to send the insurance check so that the roofer can be paid. … – Realty Biz News

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Mortgage-Tax Break Curbed by Housing Slump – By Amanda J. Crawford – Federal tax filers claimed almost $71 billion less in mortgage interest deductions for 2009 than for 2007, a 14 percent drop, according to the Internal Revenue Service. That trend continued in 2010, the IRS said in a report last month, as preliminary data showed that lower interest rates, home ownership and home prices curbed use of the tax deduction by 7.2 percent. “People are walking away and losing their homes and they no longer have the mortgage interest deductions,” said Andrew Hanson, an assistant professor of economics at Georgia State University who has researched the tax break. “That’s got to be a big part of it.” – Bloomberg Businessweek 

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(shadow inventory not counted) The growing optimism on housing is not justified – COMSTOCK PARTNERS – Credit Writedowns

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(chart too) Asia dominates new treasury purchases – Sober Look Blog – Asia continues to dominate foreign purchases of US treasuries. The latest estimate show China, Japan, and Hong Kong represented the bulk of treasury purchases from abroad in Q1 20112. … The apparent return of China to the Treasury market during 1Q12 should, for the time being, have generated a welcome sigh of relief by Treasury officials as this large investor sold nearly 10% of their Treasury holdings in 4Q12 … 

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FOMC Member Biases, Statements Suggest No Drastic Changes in Next 2 Years – By Lujia Lin – DailyFX.com

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(what happens when rates finally rise?) The Cost Of Twisting (And The "Housing Recovery"): $100 Billion In Foregone NIM To The Primary Dealers – Submitted by Tyler Durden – Zero Hedge

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1 in 2 new graduates are jobless or underemployed – By HOPE YEN – Associated Press – Yahoo Finance

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(heating up?) Realty agents say low-ball offers on homes for sale, typically those that are 25% or more below list price, are disappearing in high-demand markets. – By Kenneth R. Harney – LA Times
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(mod success improves) Mortgage aid helps more hold off default – Under US pressure, lenders are offering rate cuts, extensions – – By Jenifer B. McKim – Boston Globe – … About 70 percent of the nearly 448,000 US homeowners who received mortgage help from lenders during the first nine months of 2011 are still up to date on their mortgages, according to (OCC).  That compares with an on-time payment rate of 37 percent for homeowners who received loan modifications in 2009, according to the report. The improving success rate for modifications comes as banks are under mounting pressure from federal and state officials to offer real relief to borrowers in danger of losing their homes.

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Illinois home prices halt 20-month price descent – By Justin T. Hilley – Housingwire

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Short sales top REO at JPMorgan Chase – By Jon Prior – JPMorgan Chase completed short sales on 61% of its delinquent mortgage liquidations in 2011, the most of any servicer, according to data compiled by the bank’s securities research group – Housingwire

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The Regulatory Burdens of the Dodd-Frank Act

POWERED BY LENDERS COMPLIANCE GROUP

Let it not be said that regulations are ever ‘easy enough’ to implement in these post-Crash times! *

Of course, this view presupposes that we know which regulations to factor in and which ones to factor out. It presupposes that we know which ones are relevant and which ones do not apply. It presupposes that we are in a position to keep track of new regulatory requirements, how they impact existing regulations, and how they supersede existing regulations. And it presupposes that we have sufficient time, resources, and focused energy to implement the regulations, without putting a deep drain on the already compressed margins caused by a real estate market in free fall and a loan origination market with low interest rates that have only one way to go – up!

The other day a good friend and long time client of ours, when considering all the new regulations his publicly traded firm is implementing and would have to put in place due to the Dodd-Frank Act, blurted out to me in a paroxysm of frustration: "What have we done to deserve this?" Indeed.

So, just how burdensome a burden is the Dodd-Frank regulatory burden?

IN THIS ARTICLE

Burden? What burden?
Keeping Track
The Burden Tracker
Consequences

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Burden? What burden?

Having read, outlined, and written about the 2319 page Dodd-Frank Wall Street Reform and Consumer Protection Act, I will vouch for the amazing complexity and regulatory intricacies that abound within it.

If you want a brush-up primer on Dodd-Frank, as it pertains to mortgage banking, you can read some of my published articles HERE. (See: 2010 3-Part Series on Dodd-Frank.)

And HERE are numerous newsletters that we have sent to you regarding Dodd-Frank.

The Merriam-Webster Dictionary defines the word "burden" in two basic ways: (1) something that is carried, such as a load, or it may be a duty, or a responsibility; and, (2) something oppressive or worrisome. From my admittedly non-scientific polling, it seems clear to me that the management of many financial institutions believe that Dodd-Frank satisfies both definition (1) and definition (2). Certainly, management and Boards of Directors almost universally want to fulfill their duties and responsibilities; however, what I hear most often is that they consider the duties and responsibilities that flow from Dodd-Frank to be oppressive and worrisome.

The view about Dodd-Frank that I have received from management, at financial institutions and from industry leadership, is so pandemically against the ‘burden’ of Dodd-Frank that it is hard to make a case for asserting that nefarious lobbyists in DC are deliberately misleading the public and trying to eviscerate this legislation on behalf of financial interests. Everybody agrees that Dodd-Frank is landmark legislation. But the view is that, in many aspects of Dodd-Frank, the legislation is like heaving the Hulk’s sledge hammer, when a nimble scalpel would be much more effective in providing some needed remedies to the financial system.

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LENDERS COMPLIANCE GROUP is the first full-service, mortgage risk management firm in the United States specializing exclusively in outsourced mortgage compliance and offering a full suite of services in residential mortgage banking for banks and nonbanks.

* Jonathan Foxx is the President & Managing Director of Lenders Compliance Group

Fair Lending Compliance – Some Red Flags

POWERED BY LENDERS COMPLIANCE GROUP

 

The Consumer Financial Protection Bureau (CFPB) will make Fair Lending a focus of its examinations.

 

I have written extensively on these examinations.*

 

Our firm is committed to providing comprehensive reviews in preparation for the CFPB’s Nonbank and Bank Supervision and Examination Manual (Version 1).

 

In preparing our Audit and Due Diligence procedures for our clients, we combined all the sections of the Manual into a single Directory, which is our CFPB Compendium, with links to each Manual section’s texts and the CFPB’s website texts.

 

My firm offers our CFPB Compendium, freely, as a courtesy.

Our Compendium provides:

• Directory: All Sections
• Contents: Links to Compendium Text
• Contents: Links to CFPB Website Text

 

Our CFPB Compendium is based on the Supervision and Examination Manual – Version 1, issued by the Consumer Financial Protection Bureau on October 13, 2011.

The Compendium is freely offered as a courtesy.

So, just click on the Compendium Button above and request a copy. You will receive the download instructions within 48 hours.

Also, here is our recent article, Fair Lending Compliance – Some Red Flags, which also mentions the CFPB Compendium.

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* Jonathan Foxx is the President & Managing Director of Lenders Compliance Group

Mortgages and Housing: TRACE Visualizations, Derivatives Graphic, Faster Short Sales, Balance Sheet Effect, Buy vs. Rent, Gasoline Demographics, Strong HARP2 Apps, C1 to C6 House Classifications, No Housing Crash, FC Thoughts, Schneiderman, Rents and Minimum Wage, CA Prices Rise, Short Sales Outpace FC Sales, Senior’s Home Equity Rises

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(cool) Empirasign Visualizations of TRACE Customer Buy/Sell Data – (from Adam Murphy) We just put this page up that visualizes MBS customer buy/sell trading volumes as reported to TRACE. http://www.empirasign.com/buysell/  Only trades involving Principal and Interest bonds are charted.  We don’t plot IO/PO activity–they cause too many outliers and mis-represent true volumes moving through the market.  These are most likely the same reasons TRACE breaks these trades out separately.

and – Adam Murphy quoted: (internal look at deal) The Fed needs to move quickly on Maiden Lane III CMBS asset sale – Sober Look Blog

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(scary must see graphic) How 9 Banks Are Exposed To $200 Trillion Worth Of Derivatives [Infographic] – Ben Duronio – Business Insider 

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(has list of quickest) Lenders that Sell Short Sales Faster and for Less, According to RealtyTrac – BY: ESTHER CHO – DS News 
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(new housing concept) – balance sheet effect) Here Is What The "Other" Financial Health Metrics Are Showing – Submitted by Tyler Durden – Zero Hedge

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(interesting look at buy vs. rent) Michael Olenick: Rentals Gone Wild – Naked Capitalism

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(forced to rent in NYC) The City of Sky-High Rent – By MARC SANTORA – … The uncoupling of the national economy from New York rents is not typical, said Jonathan J. Miller, the president of the appraisal firm Miller Samuel. “When you see rents rising, it is usually reflective of a strong economy,” he said. “That is not the case now.” Instead, he said, prices are being driven up by a tight credit market that forces people to stay in the rental market and limits new construction. … – NY Times
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(implications for housing?) Demographics and Changing Social Trends Behind Gasoline Sales Plunge; What About Car Sales? – Michael Shedlock – MISH’S Global Economic Trend Analysis

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Applications at 400,000 and Counting – The 2.0 version of the HARP program is off to a strong start with the nation’s five largest servicers gobbling up applications, HUD secretary Shaun Donovan told a Mortgage Bankers Association gathering Thursday morning. – National Mortgage News
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(learn about C1 thru C6 classifications) Purchase a House In Poor Condition? – Jack Guttentag – … Fannie Mae, Freddie Mac, FHA and VA recently developed a classification system for housing condition ranging from C1 (the best) to C6 (the worst). While only C6 is unacceptable to the agencies in “as is” condition, many lenders require a C-4 or better.   … – The Mortgage Professor
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(charts) The case against another catastrophic housing market crash – OC Housing News – In my view, the housing market here in Orange County is entering a three to five year period of spring rallies and fall declines with prices likely to flatten. The low end may appreciate while the high end will likely come down. That makes me somewhat bearish, certainly not bullish, but neither do I believe we will see another 20% to 30% leg down in the market to match the one we already witnessed.

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5 Reasons the Housing Market Will Not Crash (Again) – By Andrew Jeffery – (Minyanville) – TheSreet.com

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(thoughtful, read this) Some thoughts on housing and foreclosures – by CalculatedRisk

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Schneiderman Propagandist Confirms Report of Lack of Staffing for Mortgage Fraud Task Force – Yves Smith – There’s nothing like watching someone who is already in a hole dig deeper. (more) – Naked Capitalism

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(has chart) How Many Minimum Wage Hours Does It Take To Afford A Two-Bedroom Apartment In Your State? – Sara Critchfield – Ever wonder how people manage to get by on minimum wage? Oftentimes, they don’t… – Upworthy.com

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California home values’ year-over-year climb is first since 2010 – By Alejandro Lazo, Los Angeles Times – The median home price in California rises to $251,000 in March, up 0.8% from a year earlier. Number of sales jumps 2.9%.

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RealtyTrac: Short Sales Up 33% in January, Outpace REO Sales in 12 States – BY: ESTHER CHO – With the number of short sales increasing and even outnumbering REO sales in certain states, experts are speculating short sales might become key to preventing an even greater swelling of foreclosed properties on the market. – DS News

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NRMLA: Senior Home Equity Up By $30 Billion In Q4 2011 – by MortgageOrb.com – Data released by the National Reverse Mortgage Lenders Association (NRMLA) shows senior home equity increased by $30 billion in the fourth quarter of 2011. Seniors have $3.22 trillion in home equity available, according to the most recent NRMLA/RiskSpan Reverse Mortgage Market Index (RMMI) report – MortgageOrb

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Mortgages and Housing: Whalen Must Read, Volcker Rule Deadline, Performing 2nd Writeoffs, FHFA Gives 30 Days, Goodbye Independent Fed, Reverse Mortgages, Inaccurate Appraisals, Inflation, Two Harbors, Blackrock, Defaults Improve, BofA Repurchases, 50 Conditions List, Oregon Supreme Court

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(must read) Chris Whalen: The Fallacy of “Too Big To Fail”– Why the Big Banks Will Eventually Break Up – … – James J Puplava – Financial Sense – .. . For example, most banks are going to have to get out of the conduit business; that’s going to end up in the non-bank sector. Well, look at where profits came from the big banks over the last seven or eight years. It was mortgage banking; it originates itself. So if I’m even Wells Fargo, which is the last man standing in the US marketplace today, 30 percent market share, I’m eventually going to have to get out of that business; I won’t be able to own a conduit anymore. That’s pretty radical stuff.  …
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(Volcker Rule deadline extended) Fed clarifies 2-year compliance period for Volcker rule – By Alexandra Alper – Reuters – The Federal Reserve on Thursday clarified that U.S. banks will have at least until July 21, 2014 to ease into the Volcker rule’s trading and investing crackdown, as regulators sought to temper panic on Wall Street that the restrictions would be strictly enforced starting this summer. The Fed also said it has the ability to extend the compliance period for the yet-to-be-finalized rule beyond that date if needed. 
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(great explanation of performing 2nd lien writeoffs) Large Banks Begin To Recognize Reality of Second Liens – by e21 – Seeking Alpha
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(you have 30 days) FHFA Directs GSEs To Pursue New Foreclosure Avoidance Strategies – by MortgageOrb.com – The Federal Housing Finance Agency (FHFA) has directed Fannie Mae and Freddie Mac to develop "enhanced and aligned strategies" for facilitating short sales, deeds-in-lieu and deeds-for-lease in order to help more homeowners avoid foreclosure. The effort will come in stages, with the first taking place this June. – MortgageOrb

and
Is Our Long National Short-Sale Nightmare Finally Coming to an End? – By Alan Zibel – WSJ Blogs

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(goodbye independent Fed?) EXCLUSIVE: Barney Frank, Brad Miller Launch Sneak Attack on OCC, Federal Reserve – Matt Stoller – … Specifically, Frank and Miller have proposed to make the OCC and the Federal Reserve, the most important bank regulators, subject to Congressional appropriations.  Right now, those two agencies fund themselves through money printing (the Fed) or assessments on the banks (OCC).  What Frank and Miller are doing would be a major step forward for democratic accountability over our bank regulators. … – Naked Capitalism
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(chart) Changing Landscape Shows New Reverse Mortgage “Big 3″ – by Elizabeth Ecker -… a report released today from Reverse Market Insight indicates that Florida has fallen and New York has risen the ranks with its recent surge in volume. Top states California and Texas still take the top spots for endorsement volume, after New York and Florida have been “neck in neck” for most of the past year, RMI reports. … – Reverse Mortgage Daily 
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US House Panel Passes Repeal Of Key Dodd-Frank Power – WASHINGTON (Dow Jones) – A U.S. House panel voted Wednesday to revoke new powers granted to financial regulators to liquidate faltering financial firms, though the move has little chance of getting through Congress. – Wall Street Journal
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(on opinions) Inaccurate Appraisals: Weakest Buy-Back Demand – BY PHILIP R. STEIN – Mortgage Crisis Watch

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(QE money printing?) Inflation defies the Fed – by Richard Barrington – Fox Business News

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(Two Harbors jumbo mortgages) TWO put up a $2.5 billion shelf. – from Dave Akre of wholeloans.com posted at Linkedin

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BlackRock to Shift Business if Moody’s Downgrades Banks – BY SUSANNE CRAIG AND BEN PROTESS – BlackRock, the giant money manager, said it would have no choice but to shift some of its business away from certain Wall Street firms if Moody’s Investors Service went ahead with its threat to downgrade some of the country’s biggest banks. – NY Times Dealbook

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Agencies See Measurable Improvements in Consumer Default Rates – BY: CARRIE BAY     – Data through March 2012, released this week by S&P Indices and Experian showed that, with the exception of bank cards, all consumer loan types saw a decrease in default rates for the third consecutive month and in March, posted their lowest rates since the end of the recent economic crisis. … tracking the default experience of consumer balances in four key loan categories: first mortgage lien, second mortgage lien, auto, and bank card. … – DS News
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Mortgage repurchase progress slows at Bank of America – By Jon Prior – … More than $16 billion in claims are still outstanding, and more than half come from Fannie Mae and Freddie Mac. … Investors claim BofA violated origination standards before selling them on the secondary market, and are attempting to force the bank to buy them back. The bank formed its legacy asset division last year to settle the requests. Fannie, the largest mortgage financier in the U.S., and BofA severed business ties in February when the two disagreed over outstanding claims. "We continue to have disagreements," said BofA Chief Financial Officer Bruce Thompson …. – Housingwire
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(list from Linkedin MBA group) Conditions List (man they are getting long). There are probably 10-15 more conditions that I did not include. We see an average of 50 different document types collected on loan files.

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MERS foreclosure issue headed to Oregon Supreme Court – By Elliot Njus, OregonLibve.com – … If the high court gives the system a thumbs down, it could throw a wrench into thousands of pending foreclosures in Oregon and potentially upend thousands more already completed. ... If the seven justices do take on the issue, their decision could bring an end to a series of differing rulings on whether the industry’s Mortgage Electronic Registration Systems, or MERS, meets the requirements of state law when it comes to property documentation.  …

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For Rob Chrisman’s latest daily post, click here.

To subscribe to Joe Garrett’s news letter, send an email to  jgarrett at garrettmcauley dot  com

Hurt Me Mor Ski Trip Reunion Party – MBA NY Secondary May 8, 2012

If you are attending the MBA Secondary Conference in NYC, this is the premier networking opportunity! See you there – BC

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Hurt Me Mor Reunion Party – NY Secondary

Featuring Patti Wagon

TO: All Mortgage Banking Ski Trippers Living Under TARP’s

FROM: Dave and Jeff

PARTY DATE: May 8th, 2012 – 9’ISH

SUBJECT: Ski Trip Reunion @ Saloon NYC – New York

1584 York Avenue; Between 83^rd & 84th

It is springtime in Manhattan and there’s a foot and a half of snow in the Adorindacks!!! Whaddup w’ dat? The politicians continue to rain on our mortgage parade with yes, more regulations. Yet we are looking for May flowers or at least some of our BUDS to help celebrate our 26^th Reunion of the Hurt Me Mor Ski Trip. We are hoping most of you will make it to Times Square to troll the escalators of the ‘MBA Marriott – Marquis’ to find some more mortgage banking love, we are taking care of Tuesday night.

For those of you who missed this year’s trip, all we can say is – your loss. Fortunately, the ‘boyz’ were able to persuade Dubie, Higgins, Jay Gracin, Paul Gutekunst, Jim Riccitelli and Paul’s daughter, Lacey, affectionately named Patti Wagon, to reprise for all of this year’s Ski Trippers and Wannabe’s the ‘Park City Do-Over’ in Manhattan during the MBA Secondary. What, you say, are a bunch of Private Equity Dudes STILL playing in a band??? As said by Mark Knopfler and Dire Straits, “…the boys can play…” AND if you are so inclined from the Corporate Benevolence World, Dubie will always welcome any donations to their cause… 1-800-SAV-DUBI – 914-804-8046

For those of you who braved 45 degree bluebird days each day during this year’s trip, nothing need be said ‘cept – Bravery does not go unrewarded. We had ‘NUFF snow, AGAIN, followed by some over the top pool time, AGAIN and one of the very best race days ever – thank you HP Locate. We had another one of the TOP 5 ALL TIME DAYS @ Alta and did I mention how great the weather was? Fastest overall for the men went to: Craig Branca (honorable big mention to Jim Steffen); and fastest overall for the women went to: Amy Graboske. Crash and Burner was Marshall Gayden; MVP – Mike Dubeck; and deserving Rookie of the Year – Nolan Turner.

SO WHERE ARE WE GOING DURING THIS YEAR’S ADVENTURE IN NY…?

Good Question… For those of you not in the know, when WE last visited New York, we ventured downtown. This year, we are moving on up to the East – It sometimes helps when a venue fails to check us out. Mike Dubeck told him we were all from France and here for the Firemen’s Convention. You never know! On Tuesday night at an earlier than usual witching hour of 9’ish, we will be re-uning at the SALOON NYC, located at 1584 York Avenue, between 83^rd and 84^th Streets (212-570-5454). Check ‘em out at www.saloonnyc.com

Pay the bartenders VERY WELL for many may very well be former originators in your employ. And we all know how well that worked out for them…

Next years dates have been set, so you have plenty of advance notice – Wednesday, March 6th thru Sunday, March 10th. Put it down in your calendars and CHECK with us in November.

Let us know if you plan to hitch onto the Patti Wagon in Manhattan – PLEASE CALL OR EMAIL DAVE – 301-365-0407 dhurt@corelogic.com or JEFF – 303 – 493 – 3383 jeff.moran@pulte.com – TRYING TO GET A HEADCOUNT FOR BARTENDERS

Looking forward to seeing all of you in Manhattan next week and Utah, next March!

The Hurt Me Mor Boyz – Dave and Jeff – 26 and counting!  

Mortgages and Housing: HARP2 Profits, FCs to Rentals, Mitt on 2nd Homes, Gundlach Speaks, The 101, Sexy RE Agents, Geithner on FNMA, Natural Gas, S. CA, Reclassifying 2nds, Ocwen on Basel 3, Timelines, For Legal Junkies, Homebuyer Credit, VRM and VA, Buyback Risk

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(HARP2 money maker) HARP 2.0 improving bank gain-on-sale margins – By Justin T. Hilley – Analysts at Keefe, Bruyette & Woods say the strong start to Home Affordable Refinance Program 2.0 bodes well for mortgage banking volumes and margins in the second quarter, with PHH Corp. benefiting the most. … The increase in HARP volume, mortgage applications and higher interest rate lock commitments created stronger than expected gain-on-sale margins, or the amount banks realize after selling loans to the secondary market. … an increase in applications effectively front-loaded mortgage banking earnings. – Housingwire

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(good commentary) Turning Foreclosed Homes Into Rentals Could Be $100 Billion Industry This Year – OC Housing News

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(interesting look) Home Economics: “Second Thoughts on Second Homes and the Mortgage Interest Deduction” – Jason Gold – Mitt Romney caused quite a stir earlier this week when reporters overheard the presumptive GOP presidential nominee tell donors, “I’m going to probably eliminate for high income people the second home mortgage deduction.” – hattip Ira Artman – Progressive Policy Institute 
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(bullet point summary) Jeff Gundlach Speaks On The State Of The Markets And The Economy – Sam Ro – Business Insider    and     Jeff Gundlach slide show
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PRESENTING: The 101 Finance People You Have To Follow On Twitter – Linette Lopez, Rob Wile and Simone Foxman – Business Insider
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Sexy Real Estate Agents Get Higher Prices – by Mike Wheatley – Realty Biz News

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(Geithner:) Fannie Mae Fix Said to Retain Some U.S. Mortgage Role – By Clea Benson, Ian Katz and Cheyenne Hopkins – Bloomberg
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(look at the chart) North America Takes Further Steps to Export its Natural Gas – Gregor.us
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Home sales in Southern California climb, price declines slow – Home sales in March increased 2.8% year over year to 19,953 homes in the region, DataQuick reported, while the median home price of $280,000 was essentially flat, down just 0.2% from March 2011. – By Alejandro Lazo, Los Angeles Times

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Fitch Comments on JPMorgan’s and Wells’ Reclassification of 2nd Liens – BY: ESTHER CHO – With their 2012 first quarter earnings, JPMorgan and Wells Fargo revealed the reclassification of $1.6 billion and $1.7 billion, respectively, in second lien mortgages as nonperforming loans even though they are not yet delinquent. Fitch Ratings said it believes many U.S. banks are likely to follow suit, and that it does “not view this as a material shift in the performance of these loans.” – DS News
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Ocwen believes Basel regulations give nonbanks upper hand in MSR purchases – By Justin T. Hilley – Basel regulations are dampening growth of banks’ mortgage servicing business, allowing nonbank entities to swoop in and become major sources of mortgage servicing rights funding, said John Britti, an executive vice president at Ocwen Financial Corp. Britti said banks want to exit the servicing business, but will continue to be big buyers of servicing rights because they still have a fundamental cost advantage in funding. “Even if they decide they want to be in it, Basel III restricts their ability to grow, so I think banks will have to pull on servicing,” he told an audience of mortgage servicing professionals Wednesday at SourceMedia’s annual mortgage servicing conference in Irving, Texas. – Housingwire
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(has key section) New Short Sale timelines and HARP Updates – by CalculatedRisk – This might speed up the short sale approval process, from Freddie Mac: Communication Time Lines for Short Sales …

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(for legal junkies) Pauley Stirs the Pot: Federal Judge Still Making an Impact as BofA Settlement Approaches Critical Crossroads in State Court – by igradman – On April 24, Judge Barbara Kapnick will hold a hearing in New York Supreme Court on whether Bank of American’s $8.5 billion settlement proposal should be evaluated under the restrictive Article 77 vehicle, or whether investors challenging the deal can open up the proceedings to broader inquiry.  … it’s difficult to ignore the influence of a certain federal district court judge, whose name keeps popping up throughout the parties’ pleadings. … – The Subprime Shakeout

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First-time Homebuyer Tax Credit was Temporary Fix At Best – The credit led to an enormous transfer of wealth to sellers and lenders at the expense of buyers. – Dean Baker – CEPR.net

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VRM nabs multimillion-dollar VA mortgage servicing contract – By Jon Prior – … VRM, the Texas-based loss-mitigation partner with PCV Murcor, will take over servicing on the VA mortgages from origination through REO management. Though the deal has has not been publicly announced, it involves "north of $1 billion in assets," according to sources familiar with the deal. Since 2006, VRM was the sole REO asset manager for Freddie Mac until the government-sponsored enterprise extended contracts to two more firms in early 2011. … According to the VA disclosure, the contract was awarded last week and is worth nearly $179 million. … – Housingiwre
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(read this – more buyback risk coming?) Shouldering The Compliance Burden – The second anniversary of the Dodd-Frank Act is coming up in a few months, and lenders and investors are still waiting for the other proverbial shoe to drop. It’s hard to think of the current regulatory environment as a calm period, but the industry is in the eye of the storm: We are in a unique place where many regulations have been authorized or legislated, but the actual rules and details have not been announced. – MortgageOrb

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For Rob Chrisman’s latest daily post, click here.

To subscribe to Joe Garrett’s news letter, send an email to  jgarrett at garrettmcauley dot  com