Paul Muolo

The never ending refinancing boom appears to be slowing with applications continuing to fall -- but not by much.

The Securities and Exchange Commission Tuesday sued the former top executives of now defunct 'super' jumbo lender Thornburg Mortgage, accusing the trio of hiding the firm's deteriorating financial condition and overstating income by $400 million.

Prior to the crackup of the housing market, most warehouse providers were ready, willing and able to extend credit to nonbank lending customers based on the value of their retained servicing rights. But then came the crash.

GMAC Mortgage has hired Paul Ramos, a former regional manager handling Florida for MetLife Home Loans Inc., Irving, Texas.

It's hard out there for an LO - unless, of course, you have purchase money experience. The ongoing refinancing boom won't last forever. (Then again, we've heard that before.) Talk to any mortgage CEO or sales executive and chances are he'll tell you that he's hiring - but only loan officers with key contacts with Realtors and builders, which means housing may finally be poised for a true recovery.

Industry veteran Luke Hayden, who took over as president of PHH Mortgage less than two years ago, resigned from the firm this week to pursue what the company calls "other interests."

Fannie Mae is making progress on cleaning up its massive alt-A portfolio, but the $182 billion of guarantees had an average LTV ratio of 101% at yearend, according to supplemental documents the GSE filed with the Securities and Exchange Commission.

First the good news: there appears to be plenty of warehouse credit available to nonbank mortgage firms provided they have a decent capital position, seasoned management, and strong production. But what about the smaller firms that fall into the 'broker to banker' category?

It would appear that certain politicians - both left and right - look at guarantee fees and say to themselves: Hey, here's a way to raise some revenue and no one will blame us for taxing mortgage lenders. Well, guess again.

While Fannie Mae continues to bleed red ink like a busted crankcase, Freddie Mac turned a profit in the fourth quarter. Overall, it earned $1.5 billion -- but then had to give its "Godfather" (the U.S. Treasury) $1.7 billion in protection money, er, I mean, dividends. Sounds a bit screwy to me but then again the past 10 years in this industry have been screwy.

The Federal Housing Finance Agency Friday declared that the new CEOs of Fannie Mae and Freddie Mac — whoever that person might be — will earn no more than $500,000 per year, a major reduction in pay from the current job holders.

Freddie Mac posted net "comprehensive" earnings $1.5 billion in the fourth quarter, but must turn around and pay the U.S. Treasury a $1.7 billion dividend, which means it ultimately lost money during the period.

It may be a buyer's market for residential servicing rights but that isn't stopping mortgage banking firms from unloading their legacy housing receivables in an attempt to clean up their balance sheets.

Suddenly, it appears that mortgage banking is hot. Okay, maybe hot is not the best word, but in the past few weeks two residential-related IPOs have hit the market: Nationstar Mortgage, and Home Loan Servicing Solutions. Both are specialty servicers (of sorts), though the latter is really just a shell corporation created to unlock MSR value for Ocwen Financial Corp. (Or maybe I'm being too critical?)

Moody's Investor Service this week went "negative" on the mortgage insurance industry, citing the sector's weak financials and calling its future "unclear."

The Prestwick Mortgage Group will auction off a $13 million portfolio of bulk Freddie Mac residential servicing rights owned by a national bank.

Axia Home Loans, Bellevue, Wash., a $1 billion a year producer, has hired Keith Frachiseur as its new president.

Walter Investment Management Corp. lost $4 million in the fourth quarter and $69 million for the year because of costs tied to its purchase of Green Tree Servicing, St. Paul, Minn.

So, which presidential candidate knows the most about mortgage banking? Newt Gingrich who gave invaluable advice to Freddie Mac, telling that GSE to avoid subprime acquisitions? (If only, Freddy had listened!)

Outstanding residential debt serviced by mortgage banking firms fell to $9.1 trillion at yearend, the lowest reading since the third quarter of 2007, according to new figures compiled by National Mortgage News and the Quarterly Data Report.