A federal district court in Illinois did not err in dismissing a lawsuit by investors against a hedge fund over nearly $7 million lost in Freddie Mac stock before the GSE was forced into conservatorship, according to a recent ruling by the Seventh Circuit Court of Appeals. The appeals court agreed with the lower court that the plaintiffs failed to present any valid cause of action.
Certain provisions in the Consumer Financial Protection Bureau’s proposed changes to its mortgage servicing rule conflict with Fannie Mae’s and Freddie Mac’s own servicing guidelines and should be amended, according to the Federal Housing Finance Agency. In a comment letter, the Finance Agency cited the similar goals of the FHFA’s single, consistent set of servicing procedures established in 2011 to form the Servicing Alignment Initiative and the bureau’s 2013 Mortgage Servicing Final Rule. …
The Senate Committee on Banking, Housing and Urban Affairs this week approved bipartisan legislation to strengthen FHA solvency and oversight authority over lenders, paving the way toward dealing with the larger issue of housing finance reform. Introduced by Committee Chairman Tim Johnson, D-SD, and Ranking Minority Member Mike Crapo, R-ID, the FHA Solvency Act (S. 1376) passed by a vote of 21-1. The approved bill included...
Fannie Mae, Freddie Mac and their government conservator are all calling on the Consumer Financial Protection Bureau to amend proposed changes to its mortgage servicing rule because certain provisions would inhibit similar servicing goals put forth by the Federal Housing Finance Agency. In a comment letter, the FHFA said its servicing alignment initiative has pushed for improved practices that are similar to the goals of the CFPB rule, but “several provisions in the recently proposed amendments would actually make those goals more difficult to achieve.” The four areas of the CFPB proposal that are especially important cover...
Policymakers should replace Fannie Mae and Freddie Mac with mandatory mortgage insurance and a catastrophic guaranty from the federal government, according to a new paper from Promontory Financial Group, a consulting firm. The paper was prepared at the request of Genworth Financial and Promontory said the mortgage insurance firm didn’t influence the recommendations. Under Promontory’s proposal to reform the government-sponsored enterprises, private entities would both issue and guarantee their own mortgage-backed securities, private MI would be required on a loan-level basis for mortgages securitized in the new system, and a government agency would provide a back-up guaranty on the MBS payable only upon default by the MBS issuer. “Our proposal is...
The Federal Housing Finance Agency withdrew a proposed rule it was forced to issue regarding Property Assessed Clean Energy programs after prevailing in court.
The FHA is trailing Fannie Mae, Freddie Mac and the Department of Veterans Affairs in the disposition of real estate-owned properties, according to a new study from the Government Accountability Office. The study found that FHA’s net proceeds from REO sales from January 2007 through June 2012 were about 4 to 6 percentage points lower than Fannie’s and Freddie’s returns. The differences in combined returns between FHA and the government-sponsored enterprises persisted at an estimated 2 to 5 percent even after controlling for differences in value, location, market conditions and other relevant factors. In addition, the FHA took about ...
When it comes to guaranty fees, FHFA has taken "meaningful steps" to level the playing field for community lenders, one agency official testified this week.
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