Industry observers are holding out fading hope that Congress will act on time-sensitive mortgage-related bills before the lame-duck session draws to a close, but as the clock winds down, real estate interests are already adjusting their legislative expectations for 2013. At the top of the list of mortgage bills being watched closely is the extension of the Mortgage Forgiveness Debt Relief Act of 2007. The law exempts up to $2 million in mortgage debt forgiven by a lender in a short sale, loan modification or foreclosure from federal taxation. Despite support from both political parties, industry groups and consumer advocates, legislative efforts to renew the act have...

Warehouse commitment volumes remained strong in the third quarter as nonbanks continued to need credit to meet the surging demand for refinancing, according to new survey figures compiled by Inside Mortgage Finance. The strong showing was hardly surprising, but several warehouse executives noted one new trend: a small revival in syndicated warehouse lines where several banks participate in the credit. “A year ago there were...

The distressed property share of home sales has decreased in each of the seven months ending in November, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey, as short sales, real estate owned activity and investor purchases have become less prevalent. Distressed properties accounted for 33.7 percent of home sales in November, based on the three-month moving average, the lowest level seen in more than three years. Before the decline in distressed property activity, distressed property sales had hovered around 42.0 percent for more than two years. “As housing prices rise and unemployment declines, there are...

Some mortgage lenders will be able to develop and test, on a limited basis, their own consumer disclosures, under a proposed policy issued last week by the Consumer Financial Protection Bureau. The disclosures would have to be approved by the bureau before being used. “The bureau believes that there may be significant opportunities to enhance consumer protection by facilitating innovation in financial products and services and enabling companies to research informative, cost-effective disclosures,” the CFPB said. “The bureau also recognizes that in-market testing, involving companies and consumers in real world situations, may offer particularly valuable information with which to improve disclosure rules and model forms.” The Dodd-Frank Act gave...

The retreat of some large loan aggregators from the mortgage market has been a challenge for many small loan originators, but Federal Home Loan Bank officials say the Mortgage Partnership Financing Xtra program has gone a long way to pick up the slack. Through MPF Xtra, six FHLBanks provide member institutions an alternative for selling first mortgages that they originate that allows them to retain customer relationships without taking on interest rate and prepayment risk. The program is one of several options under the Mortgage Partnership Finance program, which is run and managed by the FHLBank of Chicago. Introduced in 1997, the MPF provided...

Potential homeowners need to reset their expectations about homeownership, and the federal government should eventually reduce its role in housing finance, according to Brian Moynihan, CEO of Bank of America. In a speech late last week at the Brookings Institution, Moynihan suggested that the financial crisis has created an opportunity to change long-held views among homeowners, the federal government and lenders. He said the conversation about homeownership rates should shift from what percentage of Americans own homes to what is the right solution at the right time for each individual or family. “The past five years of high unemployment and underwater home values have taught...

Mortgage securitization rates remained at record levels through the third quarter of 2012, with 86.3 percent of primary market originations being financed as MBS, according to a new analysis by Inside MBS & ABS. A total of $1.15 trillion of MBS backed by recently originated loans were issued through the first nine months of the year, soaking up most of the $1.33 trillion in new production during that period. The market is on track to top the record 84.4 percent securitization rate set for the full year back in 2009, after two years in which the rate had drifted somewhat lower. During the third quarter, the securitization rate surged...[Includes one data chart]

Two separate white papers from industry trade groups on reform of the government-sponsored enterprises call for a strong government role to provide stability and liquidity in multifamily mortgage finance. The Mortgage Bankers Association called for a system of private capital finance for multifamily housing, with a focus primarily on securitization and the federal government serving as a catastrophic insurer. The program would be funded through risk-based premiums paid by the entities that securitize the loans, according to Brian Stoffers, president of CBRE Debt and Equity Finance. “We recognize...

Despite the ever-increasing volume of political chatter that the White House is poised to nominate a new director of the Federal Housing Finance Agency, industry observers tell Inside The GSEs they aren’t altogether convinced the Obama administration is able or even willing to effect agency regime change and assume full ownership of the GSEs at this time. Following President Obama’s re-election last month, speculation shifted quickly from “if” to “when” Edward DeMarco, a Bush-era hold-over who recently began his fourth year as the FHFA’s “temporary” head, would be replaced.

Despite gains in oversight and reform of the compensation packages for Fannie Mae’s and Freddie Mac’s top-level executives, the Federal Housing Finance Agency needs to beef up its reviews and examinations of the pay packages for the scores of vice presidents and directors currently employed by the two GSEs, according to the Finance Agency’s official watchdog. The FHFA’s Office of Inspector General report released this week noted a “significant cost” involved in the compensation of the two GSEs’ nearly 12,000 employees.