Compliance & Regulation

The city of St. Paul, Minn., has reached a settlement with two landlords in a long-running federal lawsuit in which the city is accused of hurting minority tenants by aggressively enforcing its building codes, thereby reducing the supply of affordable housing.

The business of bundling riskier U.S. mortgages into bonds without government backing is gearing up for a comeback. Just don't call it subprime.

At a hearing Tuesday, GOP lawmakers hammered FHFA Director Mel Watt for four hours over his recent decisions to allow Fannie Mae and Freddie Mac to buy loans with lower downpayments and provide money to two affordable housing trust funds.

With conservatorship of Fannie Mae and Freddie Mac well into its seventh year, the government has now had control of the housing agencies longer than 47 members of the Senate have been office.

Homeowners associations seeking unpaid dues are seizing on a court decision allowing them to foreclose on properties ahead of banks, and the FHFA is litigating to defend Fannie and Freddie mortgages. Private lenders, meanwhile, are trying to keep the problem from spreading to more states.

A majority of small bank executives are concerned about the impact of new regulations on their mortgage lending business, according to an industry trade group.

A California loan broker who defrauded investors of more than $17.4 million has been sentenced to five years in prison.

The Supreme Court gave borrowers the path to file a rescission notice without going to court, but experts expect more banks to initiate legal proceedings to stop rescissions they see as frivolous.

Recently disclosed emails and documents give the clearest evidence yet that high-level banking officials pushed subprime mortgage loans knowing some Detroiters couldn't pay them — helping spark a foreclosure crisis that devastated the city during the Great Recession.

Consent decrees issued (and not issued) last week demonstrate how having appropriate compliance controls can and will make a major difference in any potential regulatory response.