The former chairman and owner of Taylor, Bean & Whitaker was slammed with a 30 year prison sentence and ordered to forfeit approximately $38.5 million for his key role in orchestrating a $2.9 billion fraud scheme that led to the failure of TBW and Colonial bank and counted Freddie Mac as among its victims.

Mortgages modified by Fannie Mae slightly outperformed those modified by Freddie Mac in the short term while Freddie’s loans performed moderately better a year after modification, even as the performance of mortgages serviced by the two GSEs improved during the first three months the year, according to the first quarter Mortgage Metrics report issued by the Office of the Comptroller of the Currency and the Office of Thrift Supervision.Fannie loan mods had a 12.5 percent re-default rate three months after modification, while Freddie mods saw a 13.3 percent rate. At the six-month mark, the GSEs tied at 21.4 percent.

There is a good chance that criminal charges will be brought by the U.S. Department of Justice against the major mortgage servicers following a nationwide probe into robo-signing and other foreclosure processing issues. Officials representing the Financial Fraud Enforcement Task Force, a broad coalition of federal agencies working with state and local officials, said during a recent hearing in the Senate Judiciary Subcommittee on Administrative Oversight and the Courts, that further investigations and prosecutions stemming from ...

Facing a growing coalition of dissatisfied non-agency mortgage-backed security investors, Bank of America announced this week that it plans to settle a large portion of its non-agency MBS claims related to buybacks and servicing. The action sets a precedent for the sector, making settlements with other non-agency MBS issuers more likely. “Bank of America has charted...[Includes one graph]

Following signs that the Consumer Financial Protection Bureau may been far more involved in the 50-state servicer settlement discussions than it has publicly let on, key Republican House committee chairmen have called upon Treasury Secretary Timothy Geithner to provide documents and records related to the CFPB’s role in the negotiations, un-redacted, by no later than July 5. In their request, the lawmakers cited a copy of a CFPB settlement presentation that recommended goals, provided…

The FHA has clarified its approval and recertification process and policies for condominium projects in newly revised guidelines. Guidance in Mortgagee Letter 2011-22 formalizes and expands policies Ginnie Mae put in place in 2009 and lays the groundwork for a formal rulemaking later this year. The mortgagee letter includes a condominium policy guide and implementation schedule laying out timelines for compliance. The revised guidelines “preserve FHA’s role in the condo market during these difficult times while making certain we manage risks in a responsible way,’ said FHA Acting Commissioner Robert Ryan. Overall, the mortgagee letter and guide spell out...

Bank of America’s commitment to set aside $20.4 billion to address a big chunk of its exposure to the mortgage debacle it acquired when it bought Countrywide Financial may point toward evolving new servicing standards for the industry at large. But officials acknowledge that it’s hard to estimate the risk of future buyback costs, especially as the policies of Fannie Mae and Freddie Mac continue to change and other litigation – including nego-tiations with state attorneys general – is still pending. BofA agreed to pay $8.5 billion to settle representations and warranties claims and ...

The home purchase mortgage market remained anemic in May as many would-be homebuyers remained on the sidelines for the start of the historically stronger summer home purchase season. And to make matters worse, a combination of tough mortgage underwriting and a high level of distressed properties continued to push up cash sales. According to new numbers released by the Campbell/Inside Mortgage Finance HousingPulse Tracking Survey, cash sales accounted for 31.3 percent of the home purchase transactions in May. That was up from 30.1 percent in April and represented the ... [includes one graph]

The challenges confronting the recovery of the non-agency MBS market are many, but legacy issues, such as representations and warranties, are the cause of huge frustration in the industry, according to panelists at the American Securitization Forum this week. “Some of these legacy issues have very far-reaching tentacles,” observed Mani Sabapathi, principal at Prudential Fixed Income. The housing finance world has been bracing for the coming risk-retention rule with great apprehension, he said, raising the possibility that reps and warrants could be included as a part of it. “I think it can be an important aspect to the extent that if you have these loans that don’t meet...