Freddie Mac’s government conservator is stepping up to shut down a potentially costly lawsuit filed against the GSE by the Mortgage Guaranty Insurance Corp. both by legal and by extra-legal means. Last month, the Federal Housing Finance Agency told a Wisconsin federal court that it lacks jurisdiction over the pool insurance suit the mortgage insurer filed against Freddie. Given that the suit would impede FHFA in its capacity as the GSE’s conservator, the court should dismiss MGIC’s suit, according to court papers filed by the Finance Agency on July 20.

Freddie Mac last week said it will tweak its eligibility requirements to be more in line with Fannie Mae and expand the pool of its borrowers eligible to refinance through the recently revised Home Affordable Refinance Program. Under Freddie’s Relief Refinance Mortgage Program – which includes HARP – the requirements for refinancing will be aligned for mortgages with loan-to-value ratios that are equal to or less than 80 percent. Fannie’s HARP refi program currently makes no distinction between loans that are above or below 80 LTV, while Freddie draws a line in a number of areas for borrowers going through HARP at their existing servicer.

Fannie Mae and Freddie Mac each sold significantly more units of real estate-owned properties than the two GSEs took during the second quarter of 2012, a factor at least one of the companies says helped push it into the black during the April to June earnings period. Fannie reported its total inventory of REOs as of June 30, 2012, was 109,266 compared to 114,157 on March 31, selling nearly 5,000 more foreclosed homes than the GSE acquired. "Sales prices on disposition of our REO properties improved in the second quarter of 2012 as a result of strong demand,” explained Fannie in its second-quarter earnings report. “We received new proceeds from our REO sales equal to 59 percent of the loans’ unpaid principal balance in the second quarter of 2012, compared with 56 percent in the first quarter of 2012 and 54 percent in the second quarter of 2011.”

The mortgage credit-enhancement business has been no place to be the past few years, but many observers think the market has touched bottom and is starting to come back. After hemorrhaging losses since 2008, the two biggest mortgage credit-enhancement providers – Fannie Mae and Freddie Mac – reported positive net income on their single-family guaranty businesses during the second quarter. The private mortgage insurance industry hasn’t gotten there yet. Fannie and Freddie reported...[Includes two data charts]

A number of nonbanks have increased their correspondent originations recently with plans to take more market share as the big banks focus on retail lending. Redwood Trust, PennyMac Mortgage Investment Trust, Homeward Residential and others have all touted their recent correspondent efforts, both for agency mortgages and non-agency originations. Since 2010, Redwood has used its conduit platform to supply...

A mortgage marketing program with a money-back guarantee sounds too good to be true, but participating lenders that reported more than 400 percent return-on-investment can probably attest it is no scam. Mortgage Returns, a provider of customer relationship management and marketing solutions, reported that 35 lenders in its Guaranteed Marketing program averaged a 426 percent ROI after using it. The program revolves around the company’s Five-Touch mortgage refinance campaign. Launched in May, the program generated...

The cost to close on a mortgage has dropped seven percent to an average $3,754 in the past year, according to the eighth annual closing costs survey from Bankrate.com. Title insurance and other third-party fees fell 12 percent from last year’s levels, while origination fees dipped a slight one percent. “This is the second year in which lenders are required...

Ocwen Financial is set to reduce its effective tax rate by more than half due to the recent formation of a subsidiary corporation in the U.S. Virgin Islands. The federal corporate income tax rate in the U.S. is 35.0 percent and Ocwen had an effective tax rate of 36.0 percent through two quarters in 2012. “We believe [Ocwen’s effective tax rate] will be mid-to-high single digits,” said Bill Erbey, executive chairman of the servicer, during an earnings presentation last week. He said the lower tax rate could take effect...

Mortgage insurance activity increased dramatically during the second quarter of 2012, with private MIs gaining ground on the government-insurance programs, according to a new ranking and analysis by Inside Mortgage Finance. A total of $133.22 billion of home mortgages were originated with some form of primary MI coverage during the second quarter, up 22.9 percent from the first three months of the year. It was the biggest quarterly output of primary MI since the middle of 2009, and it lifted insured mortgage originations to $241.64 billion in the first half of the year, up 36.1 percent. Despite a relentless assault on their financial health that has driven three companies into runoff mode, private MIs racked up...[Includes three data charts]

The private mortgage insurance industry is now officially under the microscope of the Consumer Financial Protection Bureau over its captive mortgage reinsurance premium ceding practices for possible violations of key federal statutes, including the Real Estate Settlement Procedures Act. The CFPB is carrying forward a number of investigations it inherited from the Department of Housing and Urban Development after passage of the Dodd-Frank Act. Critics contend that captive reinsurance programs violate RESPA’s prohibition by collecting insurance premiums without providing any real service or value to the transaction. Civil investigative demands, or CIDs, sent to several private MIs “mean...[Includes one data chart]