Compliance & Regulation

Capacity issues — in terms of the number of reliable bodies available to take mortgage loan applications — is a key reason why the loan brokerage sector will survive, attendees of the MBA convention in Atlanta were told Monday morning.

New regulations pending as a result of the recently enacted Dodd-Frank Financial Reform Act have sparked a mad dash among mortgage lenders to income, employment and asset verification products.

It's time for mortgage originators to draw a line in the sand when it comes to being forced to buy back loans from investors, an industry veteran said at the Mortgage Bankers Association's annual convention in Atlanta.

Housing developer AvalonBay Communities Inc. and partners will pay $2.2 million to settle a two-year-old discrimination case brought by the U.S. Justice Department regarding a bond-financed multifamily project in New York.

WASHINGTON—Two Houston mortgage firms with common ownership have agreed to pay $84,000 in separate settlements with the HUD Mortgagee Review Board.A mortgage brokerage firm with 200 branches nationwide, Allied Home Mortgage Capital Corp., agreed to pay a $38,000 fine to settle allegations that it violated branching rules mandated by the Federal Housing Administration.

Fears of undetected financial reporting fraud feeding into “foreclosure-gate”-type concerns are bringing together insiders worried about their industry’s future.

Robo-signers and foreclosure mills perpetrating fraud on the courts. Bond investors questioning the contents of mortgage-backed security trusts. Challenges to banks' legal standing. These problems, once viewed as isolated or inconsequential, have been conflated into a monster supposedly capable of paralyzing foreclosures and obscuring the rightful ownership of real estate nationwide.

The Mortgage Bankers Association has declared that the "punitive" penalties the Department of Housing and Urban Development charges servicers for failing to initiate foreclosures on a timely basis are "arbitrary in their severity" and need to be changed.

Mortgagees will be able to view sponsored originator performance information in Neighborhood Watch. On a monthly basis, FHA will aggregate sponsored originator performance for a rolling two year period. A link to the sponsored originator performance will be added under the Early Warnings menu selection.

Federal Reserve chairman Ben Bernanke said the central bank is "looking intensively" at the foreclosure and servicing practices of the nation's largest banks to see if these institutions are improperly taking homes.