Fannie Mae will no longer purchase or securitize loans with mandatory arbitration clauses starting Nov. 1, according to a new Fannie seller/servicer guide."While Fannie Mae does not believe arbitration provisions are inherently abusive, we believe that mandatory arbitration can be used in an abusive fashion," guide announcement 04-06 says. Fannie Mae is allowing one exception, however, if the loan contract contains a waiver that states that the arbitration requirements are "null and void" once the loan is sold or transferred to Fannie Mae. "The seller will provide the borrower with written notice of the triggering of the waiver within 60 days of the transfer or sale," Fannie Mae says. On Aug. 1, Freddie Mac stopped purchasing asset-backed securities whose underlying loans contain mandatory arbitration clauses. The Fannie Mae guide also alerts lenders that a Massachusetts predatory-lending law goes into effect Nov. 7 and that the secondary-market agency will not purchase home loans that the state classifies as "high cost."
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The lender recorded a $59 million net loss in the fourth quarter, an 83% improvement from its third quarter performance.
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Initial analyses of Home Mortgage Disclosure Act data show UWM ahead in 2023 loan numbers and dollar volume, but Rocket's market share still looks competitive.
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Last year, the Raleigh, N.C.-based Integrated called off a deal to sell itself to MVB Financial after bank stocks took a hit in the aftermath of the regional bank failures. Capital hopes to expand its government-guaranteed lending with the transaction.
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The pending end of the program comes as over half of U.S. states have already ceased accepting new applicants for federal aid aimed to help struggling households with mortgage payments.
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But the 30-year fixed rate mortgage is still near 7%, and that remains the overhang on the housing market, Freddie Mac said.
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Mortgage payments rose 10% year-over-year to an all-time high for March, Redfin said.
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