Servicing

The government and the mortgage banking industry may need to revisit how they are dealing with third-party service providers. New government regulations focus on banks, not the mortgage servicing community as a whole, says Denis Brosnan, CEO of Atlanta-based Prommis Solutions, and that approach is particularly obvious at the annual Mortgage Bankers Association gatherings.

Fannie Mae and Freddie Mac should bundle at least 200 REO properties in a given metropolitan area into one pool to attract bids by large investors that are willing to rent out single-family homes for at least three years, according to Laurie Goodman of Amherst Securities Group.

Raj Date, the de facto head of the Consumer Financial Protection Bureau, said Tuesday that misaligned incentives led to some of the major problems in mortgage servicing and still persist.

The chief author of the Dodd-Frank Financial Reform Act took exception to what he called "the revolt against risk retention," saying requiring originators to hold 5% of the loan amount on their books is "one of the central things we did in the bill."

Eight years ago a Bear Stearns research report on the mortgage insurance industry warned of a grave threat: In exchange for steering home buyers to the insurers, mortgage lenders were demanding unjustifiably lucrative reinsurance deals.

Any borrower who believes they were harmed by a foreclosure initiated by 14 major servicing banks soon can seek out an independent review of their case, according to Comptroller of the Currency John Walsh.

Fannie Mae chief economist Doug Duncan on Monday raised his 2011 origination forecast to $1.2 trillion, up from a recent forecast of $1.09 trillion.

The latest jumbo securitization from the only issuer that has been in the market recently has a lot of positives as usual. But among its few negatives is a slightly reduced and somewhat idiosyncratic geographic concentration risk that may be offset by the strength of the regional originator the produces it.

It appears as though lower GSE loan limits may soon become reality, but that hasn't stopped housing, realty and mortgage trade groups from promoting the issue.

Rialto Investments, the distressed asset arm of home builder Lennar Corp., took a $10 million charge relating to its joint venture with AllianceBernstein LP in the third quarter.