Compliance

The crimes that contributed to historic levels of default may be creeping back into the industry, according to the latest quarterly Mortgage Fraud Risk Report from Interthinx.

In order to prevent fraudsters from flipping properties quickly at high appreciations, lenders will be focused in the coming months and year on putting a stop to “flipping” by putting processes in place to eliminate short-sale fraud.

A handful of state attorneys general are taking a hard line with mortgage servicers by demanding loan modifications and principal reductions for those borrowers whose rights may have been violated by robo-signing.

An investment banking firm is warning federal regulators that a congressional mandate to stop relying on the credit ratings of Standard & Poor's and other agencies could be disruptive to the MBS market and increase capital requirements for depository institutions.

The Federal Home Loan Bank of Seattle entered into a consent order with the Federal Housing Finance Agency late Monday that requires the bank to take certain steps to improve its capital position and its business and operations.

Lenders should face penalties for violating representation and warranty clauses — beyond their obligation to re-purchase the loans — according to an expert in managing risk on mortgage-backed securities.

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.

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

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.

Sb1 Federal Credit Union of Philadelphia is still trying to find out how to identity thieves were able to tap into a customer's home equity line of credit, steal his private information – including passwords – and convince the credit union to wire $220,000 from the HELOC to an unrelated account in Hong Kong.

With Fannie Mae suing insurance carriers over coverage for the $140 million fraud at U.S. Mortgage/CU National Mortgage, credit unions victimized in the scandal are wondering whether any recovered funds will be used to compensate them for their losses.

The Federal Housing Finance Agency has hired a private law firm as it continues to review subpoenaed loan documents from banks and Wall Street firms that sold Fannie Mae and Freddie Mac private-label MBS.

A former loan originator in the wholesale business is pondering getting back into the market as a loan officer after being gone for three years. Grapevine users share their opinions on current volume, the future of interest rates, and the prospect of making money down the line.

While fraud risk had trended down dramatically through 2008 and even into early 2009, in mid-2009 and 2010, it started to creep back up again, according to Frank McKenna, vice president of fraud strategy for analytics provider CoreLogic.

Any mortgage fraud reported today might not get dealt with until at least two years from now because federal agents are still dealing with cases from 2005-2008, Federal Bureau of Investigation agents told the Northeast Conference of Mortgage Brokers in Atantic City, N.J.

Major mortgage servicers’ internal reviews of foreclosure documents extend far beyond robo-signers’ affidavits verifying a borrower’s mortgage debt.

The California 4th District Court of Appeal held that brokers for home sellers have a legal duty to tell buyers about mortgage problems such as a short sale where existing lender may not accept less than what is owed and that might prevent sales from closing. Brokers are "obligated to disclose to the buyers" when there is "a substantial risk that the seller [can] not transfer title free and clear of monetary liens and encumbrances."

Former Countrywide Financial Corp. co-founder and CEO Angelo Mozilo and two of his top lieutenants at the once highflying lender/servicer have agreed to settle a massive civil fraud complaint filed against them by the Securities and Exchange Commission.