Compliance & Regulation

Adding to the injunction filed in Clark County, Nev., last week, another lawsuit has been filed in Los Angeles County on behalf of three local individuals who placed deposits towards condominiums at the Cosmopolitan of Las Vegas.

Congress passed H.R. 4173 on July 15. Although it's formally known as the Dodd-Frank Wall Street Reform and Consumer Protection Act, I like to think of it as "FrankenDodd" because this monster tops out at more than 2,300 pages and will require several hundred new rules to fully implement. It will be at least three years before everything is finalized, and it will take a decade or two to judge whether its purpose—to overhaul the financial services industry so as to prevent another economic collapse—was successful.

On Aug. 1, use of a revised reverse mortgage application became required by the Department of Housing and Urban Development.HUD first announced the revised form, known as Fannie Mae Form 1009, in a mortgagee letter issued in March. In addition, the Federal Housing Administration will no longer allow originators to use the Uniform Residential Loan Application, also known as Fannie Mae Form 1003/Freddie Mac Form 65 for Home Equity Conversion Mortgages.

Efforts are being made to proactively protect homes in default and foreclosure by sharing valuable information regarding appraisal fraud in short sale transactions.

WASHINGTON-The odds may be against them, but mortgage industry groups are staging a major push to pass a standalone Federal Housing Administration reform bill before the Senate adjourns Aug. 7 for a month-long recess.

There has been a lot of talk about government protecting mortgage investors in the wake of the downturn, but Tal Franklin, an attorney whose law firm represents a clearinghouse of private-label residential mortgage-backed securities investors, says it depends.

U.S. Central Federal Credit Union reported late Monday that growing losses on its portfolio of private-label mortgage-backed securities created a $39.4 million loss for its second quarter, and an $84.8 million loss for the first-half of the year.

Bank of America has agreed to pay $600 million to settle several class action lawsuits filed by Countrywide Financial Corp. shareholders over the lender's subprime program, according to a report in The Los Angeles Times.

Hudson Valley Federal Credit Union, Albany, has appealed its challenge of the state's mortgage transfer tax - rejected by the lower court - arguing the federal credit union charter exempts it from all state taxes.

Treasury secretary Timothy Geithner wants federal regulators to move quickly in formulating new underwriting standards and disclosures for mortgages mandated under the Dodd-Frank Wall Street Reform and Consumer Protection Act.