Compliance & Regulation

Mortgage fraud continued at elevated levels in fiscal year 2010 and the Federal Bureau of Investigation continues to "dedicate significant resources to the threat," the agency says in its FY 2010 Mortgage Fraud Report.

Bank of America told investors that its liabilities for mortgage repurchase requests from Fannie Mae and Freddie Mac could be worse than expected. Bank of America now says its total potential GSE losses for the mortgages sold to Fannie Mae and Freddie Mac stand at $7.8 billion. (sfbustmes8611)

Small community banks will have to pay for a compliance audit if they want to continue to originate FHA-insured single-family loans, according to the Department of Housing and Development.

Ways in which the industry can prevent fraud are evolving along with the nature of fraud itself, and the answer to preventing one of the latest waves of fraud appears to lie in finding new and better ways to track participants and their information in distressed home sales as well as in mortgage transactions.

An indictment has been filed in Manhattan Federal Court charging 14 defendants for participating in a mortgage fraud scheme that involved over 100 home mortgage loans valued at more than $58 million.

National mortgage fraud risk is down 2.3% from a year ago and is 1% lower from the previous quarter, but is still at an elevated risk, Interthinx said in its latest Mortgage Fraud Risk Report.

When an individual participates in a closing to buy, or sell a home or refinance their mortgage, the main reason that such a complex real estate transfer can be quickly accomplished is because an independent, third-party professional has already pulled together all of the documentation necessary to close the transaction.

National mortgage fraud risk is down 2.3% from a year ago and is 1% lower than the previous quarter, but is still at an elevated risk, Interthinx said in its latest Mortgage Fraud Risk Report.

The Department of Housing and Urban Development is developing a set ofpolicy changes that would require reverse mortgage lenders to better underwrite Home Equity Conversion Mortgages. But lenders may beat HUD to the punch.

The Federal Home Loan Bank System is seeking an exemption from pending risk retention rules so they can continue to provide risk-sharing mortgage programs that they claim have exhibited "superior credit performance" for more than a decade.