Two of the 12 Federal Home Loan Banks announced last week they are deep into merger talks that, if consummated, would create the largest single entity within the FHLBank system. The proposed merger of the FHLBank of Des Moines and the smaller, troubled FHLBank of Seattle would create an institution with more than 1,500 member financial institutions in 13 states and three U.S. territories in the Pacific Ocean. “A detailed due diligence process is...
With origination volumes sucking wind this year, plenty of mortgage companies are pondering whether now is the time to sell, but so far few deals of any size have been consummated. That may change in the coming months. On the buy-side, a dozen or so potential acquirers have emerged, including such growth-minded nonbanks as Prospect Mortgage, RPM Mortgage – both of which are based in California – and possibly AmeriSave Mortgage of Atlanta. Also, Willie Newman, the former CEO of Cole Taylor Mortgage, has teamed up...
The New York Department of Financial Services said it has concerns that certain nonbank servicers are using complex arrangements with affiliates to side-step borrower protections in force-placed insurance. Superintendent of Financial Services Benjamin Lawsky detailed what he called a “troubling” scheme between Ocwen Financial and a “related party,” Altisource Portfolio Solutions. “This complex arrangement appears designed to funnel as much as $65 million in fees annually from already-distressed homeowners to Altisource for minimal work,” Lawsky said in a letter this week to Timothy Hayes, Ocwen’s general counsel. According to the NYDFS, Ocwen recently implemented...
The Consumer Financial Potection Bureau has been asked to make certain clarifications to the mortgage servicing rules that took effect early this year amid growing industry concern over the high cost of compliance. In a recent letter to the bureau, the American Bankers Association asked the agency to clarify the application of the “120-day rule,” which prohibits servicers from sending notice or filing for foreclosure unless the borrower is 120 days or more behind on the mortgage payment; requirement for periodic statements for charge-offs; and publication of an interim final rule providing bankrupt borrowers limited exemptions from the servicing rules. Complying with the servicing rules is...
Five years after the first round of loan modifications began in April 2009 under the Treasury Department’s Home Affordable Modification Program, 32,111 loans are scheduled for their first interest rate resets this October. The impact of this first wave is expected to be limited. But in each of the next successive four years, HAMP resets will reach into six-figure territory, and by the time the smoke clears, upwards of 800,000 loans will face multiple interest rate tests. “The HAMP resets will be...
The New York Department of Financial Services’ exam of Ocwen Financial has expanded into a force-placed insurance deal with Altisource Portfolio Solutions.