Judge Rosemary Collyer of the U.S. District Court in Washington, DC, has rebuffed the Federal Deposit Insurance Corp.’s effort to dismiss a $10 billion lawsuit filed by a unit of Deutsche Bank AG over pools of mortgage loans made by Washington Mutual that later went bad. Deutsche Bank, as trustee for the securitized pools at issue, filed suit against the FDIC as well as JPMorgan Chase, arguing that one or the other should be liable for losses suffered by the pool from WaMu’s allegedly fraudulent or poorly underwritten residential mortgages. The trusts involved had been investigated by a Senate subcommittee, which revealed that internal reviews performed by WaMu had determined that “loans marked as containing fraudulent information had nevertheless been securitized and sold to investors.”

Senate Banking Committee. Richard Cordray nomination. The Senate Banking, Housing and Urban Affairs Committee has planned a Sept. 6, 2011, hearing to consider the nomination of Richard Cordray to be director of the Consumer Financial Protection Bureau. Political observers will look for signs from Republican members of the committee, particularly Alabama Sen. Richard Shelby, of any potential easing of opposition to the appointment. Thus far, GOP members of the Senate have uniformly remained adamant to the naming of any director to the CFPB until some significant changes are made to its structure, the most notable of which would be the replacement of a single director with a board leadership structure.

The Obama administration is seeking ideas from stakeholders on how to thin out the FHA’s inventory of foreclosed homes, including turning the homes into rental properties to meet the growing need for affordable housing. In addition to addressing the FHA’s real estate-owned, or REO, problem, the Federal Housing Finance Agency, the Department of the Treasury and the Department of Housing and Urban Development are also calling for recommendations for similar home rental programs for REO properties held by Fannie Mae and Freddie Mac. The agencies’ request is aimed at finding the best alternative for “maximizing value to taxpayers and increasing private investment in the housing market, including ...

The Department of Housing and Urban Development has developed a new Web-based tool which allows FHA, Fannie Mae and Freddie Mac to map all foreclosed properties for viewing by potential investors and homebuyers. The new mapping tool displays the location of all foreclosed homes in the agencies’ inventories, which account for nearly half of all real estate-owned or REO properties in the U.S. Communities with high foreclosure rates that are participating in HUD’s Neighborhood Stabilization Program (NSP) will find the REO portal useful in targeting federal funds to acquire, rehabilitate or demolish these REO properties, according to department officials. The map’s consolidated graphic listing enables ...

The consensus among mortgage market watchers is that the downgrade earlier this month of the GSEs by Standard & Poor’s will have no immediate, detrimental impact even as Fitch Ratings this week said it is keeping Fannie Mae and Freddie Mac’s “AAA” rating.Fitch this week also said its outlook for Fannie and Freddie’s ratings remained “stable.” The move was in concert with Fitch’s decision to keep its rating on U.S. debt at the highest grade.“A key element of the explicit support is the guarantee by the U.S. Treasury to inject funds into Fannie Mae and Freddie Mac, so that each firm can avoid being considered technically insolvent by their regulator,” said the rating agency.

The rush to Treasuries that resulted from investor fears about the U.S. and European economies has pushed interest rates closer to the level where a major mortgage refinance wave could start to take shape, but analysts say it’s a good time to load up on agency MBS. “The Fed’s commitment to keep interest rates low until at least mid 2013 strongly improves demand technicals for MBS, in our view,” said analysts at Credit Suisse in a report issued after the Federal Open Market Committee vowed to keep rates at historically low levels for at least two more years. “This provides ...

New York Attorney General Eric Schneiderman blew the whistle on a pending settlement between Bank of America and MBS investors worth $8.5 billion for Countrywide non-agency MBS issued before the financial crisis. Schneiderman last week filed a lawsuit against Bank of New York Mellon – a party to the settlement – for allegedly committing fraud while acting as trustee for MBS trusts securitized by BofA, and asked the court to reject the settlement proposal. “In negotiating the proposed settlement, BNYM labored under a conflict of interest because it stands ...

The recent rancorous debate over raising the debt ceiling brings little hope of relief from the overwhelming amount of regulation coming down the pike. Analysts say the uncertainty has made it more difficult to quantify risks for MBS and other securitized products. Analysts at Bank of America/Merrill Lynch said the outcome of the debate was far worse than expected, forcing them to temper their optimism for securitized products. Instead, they are calling for a more neutral exposure. “The pragmatism we thought we would see never really emerged,” said Chris Flanagan, an analyst with the firm. “Instead ...

The FHA has announced changes to help ensure prompt, accurate and consistent responses to industry and public inquiries about FHA matters. The new primary electronic mail address and Internet site of the FHA Resource Center, which includes a Frequently-Asked-Questions site, will be easier to remember and access, according to the FHA. The new email address is answers@hud.gov, which replaced the previous info@fhaoutreach.com. The site address for the FHA FAQ site will change from www.fhaoutreach.gov/FHAFAQ to www.hud.gov/answers. Users should begin using the new addresses exclusively on Aug. 15, according to the FHA. The primary...

The zero risk weight for Ginnie Mae mortgage-backed securities remains despite Standard & Poor’s recent lowering of the long-term rating of the U.S. government and federal agencies from AAA to AA+ and affirmation of the A-1+ short-term rating, according to federal regulators. The rating agency also removed both the short- and long-term ratings from CreditWatch, where they have been since July 14 with negative implications. On August 5, federal banking and credit union regulators announced that, for risk-based capital purposes, the risk weights for Treasury securities and securities guaranteed by...