Compliance & Regulation

The House Financial Services Committee late this week voted to terminate a Federal Housing Administration principal reduction program designed to refinance underwater borrowers.

Federal regulators issued a tough opening salvo in settlement talks with the nation's largest residential servicers, presenting them with a 27-page term sheet that would force major changes to the industry and step up loss mitigation efforts.

The Center for Responsible Lending late this week weighed in on the 'qualified residential mortgage' debate, saying that a 20% down payment threshold will materially shrink the overall borrower market.

The Federal Housing Finance Agency has not altered its view regarding indemnification post-conservatorship as a prerequisite for attracting and retaining skilled officers and directors.

Georgia Senator Johnny Isakson declared on the Senate floor late Wednesday that if federal banking regulators have their way with the risk retention rules — namely a 20% downpayment stipulation — they will derail the nation's housing recovery.

The HAMP and HAFA programs have not done the jobs they set out to do, relieving several million Americans from the distress of their inability to make their mortgage payments. But with the size of the job they were commissioned to do, it is too early to pull the plug on them.

Two influential California lawmakers who pushed legislation last year to require lenders to provide borrowers with a decision on their loan modification applications before starting the foreclosure process have made good on their promise to not give up.

As home lenders fret about a forthcoming regulatory proposal on risk retention, Freddie Mac soon will require a little more skin in the game from their borrowers.

At least 20 lenders are participating in FHA's principal reduction program to refinance underwater borrowers with two major lender/servicers launching pilot programs of their own, according to Federal Housing Commissioner David Stevens.

The Home Affordable Modification Program has helped more than 500,000 struggling borrowers with a median annual income of $46,000 remain in their homes, according to the Treasury Department, which found itself defending the program this week.