Long-term investor involvement is the industry’s best bet and “only realistic alternative” to boost housing demand and allow government housing agencies to meaningfully discharge their backlog of real estate owned properties, according to a report by Amherst Securities Group. However, Amherst notes that private investors will require more financing options and better access to bulk portfolios of homes, perhaps through a government program, in order to absorb and convert dormant distressed properties into active, income-producing rentals. “The massive housing market overhang is a clear danger to the U.S. economy – it creates...

MetLife announced last week that it wants to sell its mortgage banking business, but regulatory and legal issues that are partly driving the firm’s retreat may also make it hard to find a buyer. Nowadays, starting from scratch may make more sense than buying someone else’s problems. MetLife explained in a press release that the decision was prompted by an “uncertain marketplace and regulatory environment [that requires] a tremendous amount of resources – both in terms of people and capital – to effectively compete in and profitably grow the forward mortgage business. Doing so would divert these resources away from...

Flood insurance reform legislation in the Senate would result in higher net income to the National Flood Insurance Program and more federal revenues than the House version, according to a cost estimate by the Congressional Budget Office. The Senate Committee on Banking, Housing and Urban Affairs approved the bill, the Flood Insurance Reform and Modernization Act, on Sept. 8 by unanimous voice vote. The bill is awaiting Senate floor action. The House passed its bill, H.R. 1309, the Flood Insurance Reform Act of 2011, before the August recess by a vote of 406-22. Like its House counterpart, the Senate bill would reauthorize...

Last week, GMAC Mortgage announced implementation of the Responsible Homeowner Reward Program to provide monetary incentives to underwater VA loan borrowers who continue making payments on their loans. The RHRP was designed by the Loan Value Group as a way to address negative equity without necessitating additional documents or new underwriting. Homeowners build up their reward each month for a fixed period of time, so long as they are current. The size of the reward is consistent with the negative equity and severity of the loan. If the borrowers meet all of the payment milestones on time, GMAC Mortgage will...

One data chart of the GSE business profile of the top 50 mortgage sellers in the third quarter of 2011.

Despite the sound and fury from publicly peeved House Democrats directed at Federal Housing Finance Agency Acting Director Edward DeMarco, including calls for him to step aside, the consensus among industry insiders and those in the know on Capitol Hill is – good luck finding anyone else willing or able to jumpstart the underperforming GSE refinance plan while obeying the FHFA’s restrictive regulatory mandate.

Any changes that would restrict membership or narrow the Federal Home Loan Banks’ mission should come first from Congress not by administrative fiat, Bank officials told House members this week.FHLBank of Dallas Chairman Lee Gibson testified before the House Financial Services Subcommittee on Oversight and Investigations that explicit Congressional guidance is both necessary and proper before any fundamental alteration of the FHLBank system is imposed.

The Federal Housing Finance Agency needs to explain why it hired expensive outside counsel instead of dispatching government lawyers in its massive litigation against the nation’s big financial institutions, as well as just how much the agency expects to recoup from the effort, according to a senior Republican congressman.

As the Federal Housing Finance Agency ponders possible improvements to the government’s Home Affordable Refinance Program, calls from different corners of the industry are growing louder for the FHFA to end fees charged to borrowers who refinance Fannie Mae and Freddie Mac mortgages.

Fannie Mae and Freddie Mac issued $177.19 billion in single-family mortgage-backed securities during the third quarter of 2011, a modest 14.3 percent improvement following two straight quarterly declines during the first six months of this year.The recent July-September cycle represented one of the weakest quarters historically for GSE MBS production since the financial markets crashed at the end of 2008.