Compliance & Regulation

Three industry groups are urging the Federal Reserve Board to postpone implementation of new mortgage disclosures that are scheduled to go into effect January 30.

In an era of low interest rates, weak loan demand and unprecedented efforts by the Federal Reserve Board to pump liquidity into the economy, the demand for Federal Home Loan Bank advances has plummeted to a 10-year low, raising questions about the system's future as the government weighs a redesign of the housing finance sector.

The chair of the Federal Deposit Insurance Corp. warned that if left unchecked, rising government debt could rise to 185% of the country’s gross domestic product by 2035.

LEHMAN BROS., which failed in 2008 while holding bad real estate loans, on Nov. 15, filed suit against NATIONFIRST LENDING INC., an Irvine mortgage company for allegedly misrepresenting the strength of loans it sold to the Wall Street firm. The lawsuit, filed in federal court in Los Angeles, alleges that Nationsfirst Lending Inc. misrepresented the identities of borrowers, the value and condition of property securing the loans and the validity of loan documents. NATIONSFIRST is listed as a suspended corporation on the California Secretary of State website.

New federal regulation is attempting to make it as difficult as possible for fraudsters to deceive homeowners. The Federal Trade Commission has issued a new rule designed to ban the collection of fees by mortgage loan modification and other foreclosure rescue service providers until homeowners receive a written offer “that they decide is acceptable” from their lender or servicer.

The Securities and Exchange Commission has made a move that has prevented what otherwise might have been a shutdown of the securitized market in late January, according to the American Securitization Forum.

The Department of Housing and Urban Development cut corners when it attempted to upgrade a number of internal computer systems.

The federal interagency foreclosure task force that has been examining the largest mortgage servicers has been given a broader mandate by the new Financial Stability Oversight Council that held its second meeting on Tuesday.

The Oregon attorney general has filed a lawsuit accusing American Team Mortgage, Mission Viejo, for repeatedly violating the state's Unfair Trade Practices Act and Mortgage Rescue Fraud Protection Act.

In a further exodus of the Obama administration's economic team, Diana Farrell, the White House National Economic Committee's deputy director and Michael Barr, the Treasury assistant secretary for financial institutions, said Tuesday they are resigning their posts.