Commercial banks reported a measurable increase in earnings from their mortgage banking activities during the first quarter of 2011, but production volume is slowing and the industry continues to bear a significant burden from repurchase demands. Banks reported a combined $4.21 billion in mortgage banking income during the first quarter, according to an analysis of call report data by Inside Mortgage Trends, an affiliated newsletter. That was up a healthy 20.8 percent from the last four months of 2010, though it trailed the industry’s mortgage...[includes one data chart]

The supply of home mortgage debt fell again in the first quarter of 2011 despite an increase in agency servicing, according to an Inside Mortgage Finance analysis of new data released by the Federal Reserve. Outstanding home mortgage debt declined to $10.458 trillion as of the end of March, down 0.7 percent from the end of 2010. That marked the 12th consecutive quarterly decline in the supply of mortgage servicing and took the market back to a level not seen since the end of 2006. Since peaking in the first quarter of 2008, the volume of home mortgage debt outstanding has...[includes two data charts]

More than two years after being placed into government conservatorship, Fannie Mae and Freddie Mac remain “critical supervisory concerns” as “key challenges” at both government-sponsored enterprises continue to compel the GSEs to rely on federal funding to stay afloat, according to the Federal Housing Finance Agency. FHFA’s annual report to Congress this week noted losses from mortgages originated from 2005 through 2008, as well as forecasted losses from that same pre-conservatorship period, remain a continuing source of...

Quicken Loans has rolled out a new mortgage loan program that covers all closing costs if the original loan is refinanced with Quicken within seven years. The program is called “Rate Drop Advantage,” and in order to qualify, a borrower must close a mortgage loan with Quicken Loans by Dec. 31. If the borrower decides to refinance in the next seven years – 90 days after the original loan closes to 84 months after close – the Rate Drop Advantage program will...

The Federal Housing Finance Agency has issued an interim final regulation with a request for comments on changes to its existing Freedom of Information Act regulations. In its notice, published in the May 23 Federal Register, the FHFA said it is updating its existing FOIA regulations to include the FHFA Office of Inspector General. The FHFA-OIG did not yet exist when the Finance Agency’s original FOIA regulations were issued in 2009.

Look for short sales to pick up in popularity as a more palatable alternative for homeowners and mortgage loan holders to get out from under a delinquent property. However, experts caution that these quick turnaround transactions also provide ample opportunity for mortgage fraud. What had once been used for more of a niche purpose for a small segment of the buyer’s market, short sales have shot up as the market’s gone down. In 2000, about 4 percent of Freddie Mac’s workouts were short sales, compared to nearly...

In light of Fannie Mae and Freddie Mac’s federal conservatorship status and the resulting control by the Treasury Department, the two GSEs are “effectively part of the government” and their operations should be reflected in the federal budget, according to the Congressional Budget Office.CBO has concluded that using a fair-value approach to estimate Fannie and Freddie’s subsidy costs is the best way to give Congress and taxpayers the most accurate accounting information.

Housing could be in for a double-dip recession that would have a significant impact on bank earnings, according to officials at Standard & Poor’s. Robert Shiller, a co-founder of S&P’s/CaseShiller Home Price Indices, said house prices could sink another 10 to 25 percent over the next five years. “We’re kind of at a tipping point now,” he said, speaking at a housing conference sponsored by the rating service this week. “Unemployment rates are up and housing prices are down.” The lower home prices evident in data from March 2011 could represent a...

Fannie Mae and Freddie Mac’s home retention activity declined for the most part during the first quarter, according to the latest Federal Housing Finance Agency’s Foreclosure Prevention and Refinance Report.Total home retention efforts dropped to 143,977 during the first three months of the year, down 20 percent from the fourth quarter, while loan modifications in the period also declined to 86,201, down 28 percent.

The sponsor of legislation that would make Fannie Mae and Freddie Mac subject to the Freedom of Information Act’s government transparency provisions told Inside The GSEs this week he is optimistic his bill has a “real fighting chance” of passage in the House.Rep. Jason Chaffetz, R-UT, said his bill, H.R. 463, The Fannie Mae and Freddie Mac Transparency Act of 2011, has “picked up momentum” following a hearing two weeks ago, and the headlines it produced, in which the GSEs’ regulator panned the bill as potentially harmful to Fannie and Freddie.