Loan modifications

The mortgage company will provide up to $17 million in forgiveness to settle charges that modifications it applied to distressed government-related loans were not in keeping with state servicing regulations.

With no way of knowing just how many borrowers will need the mods after the coronavirus forbearance period ends, lenders are deploying artificial intelligence and servicing protocols to tame the ferocious piles of paperwork awaiting them.

Fannie Mae's profitability suffered but it managed to stabilize the mortgage market in the first quarter even with the coronavirus disrupting, among other things, certain credit-risk transfer vehicles it has used.

The government-sponsored enterprises are focusing on how loans can be repaid after the federal forbearance period ends, and projections for loan modification volumes suggest the larger industry should, too.

Homeowners reeling from coronavirus-induced economic shock are already enduring extremely long wait times while trying to get relief. Legislation passed last week could worsen the logjams.

JPMorgan Chase, Wells Fargo, Citigroup and U.S. Bancorp, along with 200 state-chartered banks and credit unions, have agreed to let borrowers skip payments for 90 days if their finances have been upended by the pandemic.

Accommodations for borrowers affected by the coronavirus pandemic, such as payment delays and fee waivers, are "positive and proactive actions that can manage or mitigate adverse impacts," the regulators said.

The Home Affordable Modification Program became a national blueprint for loss mitigation in the last crisis, but changes in the servicing landscape and circumstances call for a new approach now.

Forbearance and loan-modifications programs implemented after the financial crisis left borrowers bewildered and angry. Now the mortgage industry wants to create a common standard for providing relief to homeowners whose livelihoods have been upended by the coronavirus pandemic.

Default rates for prime jumbo mortgages will increase, but a strong economy and rising home prices will bail most borrowers and lenders out, Moody's said.

Mortgage foreclosure rescue schemes resulted in the second highest median individual loss to consumers among all types of fraud reported to the Federal Trade Commission in 2019.

Elizabeth Warren rolled out a plan to restore bankruptcy protections repealed in a 2005 law championed by Joe Biden, including those that involve mortgage lending.

Freddie Mac is automating a manual form submission process used to correct post-settlement and real estate owned data, and adding policy changes aimed at accommodating electronic signatures on loss mitigation documents.

Caliber Home Loans settled a grievance with the Massachusetts attorney general over allegations of providing distressed borrowers with unaffordable loan modifications.

The bank agreed to modify loans to struggling U.S. borrowers as part of a 2017 settlement. Instead, it’s receiving credit for financing new mortgages that likely would have been made anyway.

An agency report said servicing portfolios have shrunk by nearly half in 10 years as much of the mortgage market has shifted to nonbanks.

The bank recently notified an upstate New York man that he was wrongly denied a mortgage modification, and enclosed a $25,000 check. But details of what went wrong have been hard to come by.

Wells Fargo said Tuesday that an internal error that affected customers requesting mortgage modifications to remain in their homes impacted hundreds more people than the bank initially thought.

After a run-up in the latter half of last year, delinquencies on mortgages sold to Fannie Mae and Freddie Mac look fairly stable for the time being.

Wells Fargo estimates that in 400 instances, borrowers later went through foreclosure who were improperly denied or not offered a mortgage modification.