CLOSURE: The latest HUD changes "bring the industry closer to a point where it can complete reform and move forward," says reverse mortgage consultant Jeffrey Taylor.
The government has added further protections to reverse mortgage borrowers' spouses who are not named in the loan agreement, but placed conditions under which they are ineligible for older protections.
WORD IS BOND: "We think there is a need in the market for offering greater certainty of coverage," says David Gansberg at Arch Capital.
Arch Capital Group is repurposing a subsidiary to insure mortgages that are headed for private securitizations. Insuring such loans separately from the unit that works with Fannie and Freddie lets Arch offer more favorable terms to lenders.
At a hearing Tuesday, GOP lawmakers hammered FHFA Director Mel Watt for four hours over his recent decisions to allow Fannie Mae and Freddie Mac to buy loans with lower downpayments and provide money to two affordable housing trust funds.
Homeowners associations seeking unpaid dues are seizing on a court decision allowing them to foreclose on properties ahead of banks, and the FHFA is litigating to defend Fannie and Freddie mortgages. Private lenders, meanwhile, are trying to keep the problem from spreading to more states.
The Supreme Court gave borrowers the path to file a rescission notice without going to court, but experts expect more banks to initiate legal proceedings to stop rescissions they see as frivolous.
Early signs point to a wave of Federal Housing Administration borrowers trying to tap into lower prices for mortgage backing.
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