Mortgages

A growing number of community banks are entering the warehouse lending arena for two obvious reasons: the returns are good and it appears the risks are low, at least for now. In general, underwriting standards are so tight that the probability of a loan default is the smallest it's been in decades.

In the loss mitigation area, one of the key industry trends is a "competition for the right kind of people who have the right kind of experience," according to Gagan Sharma, president and CEO of BSI Financial.

To the naked eye, it looks as if Bank of America is shrinking its Home Loans division. In mid-September, rumors emerged that its retreat from warehouse lending is imminent, and perhaps absolute, as part of a multiphased austerity program laser focused on mortgage lending.

The mortgage industry commonly thinks of fraud on the origination side without noticing how often it is taking place in pre-foreclosure activity. As with origination, there are many pieces on the servicing side that serve up red flags to fraudulent activities.

The GSE regulator told House Democrats at a closed door meeting that the Federal Housing Finance Agency is committed to making meaningful changes to a special program that will allow more borrowers with high LTV loans to refinance at lower mortgage rates.

Helios AMC, a commercial real estate special servicer which is sponsored by Ranieri Partners, has acquired real estate advisory firm The Situs Companies. The combined entity will retain the Situs name. The purchase price was not disclosed.

Fitch Ratings found delinquencies on loans underlying commercial mortgage-backed securities declined for the second month in a row in September as its numbers bore out what the company has identified as a trend toward improvement in the hotel sector.

Credit rating agency DBRS this week approved American Mortgage Consultants, New York, as a third-party due diligence provider for residential MBS.

As the Obama Administration examines options to expedite the sale of foreclosed properties, the Federal Housing Administration is weighing a tweak to its 203(k) program, opening it once again to investors.

Analysts found prepayments surged notably in September.

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Bank of America continues to say that it's committed to retail mortgage lending, but the megabank suffered another blow recently with the departure of one of its top loan producers in the nation, Kevin Budde of Southern California.

Mortgage companies continued to pare back their payrolls in August as lenders cut 2,800 full-time employees during the month, following 1,900 layoffs in July.

The Obama Administration's efforts to expand a GSE refinancing program and reach a large number of underwater borrowers will depend on how far the Federal Housing Finance Agency will go in providing lenders relief from loan buy-backs, according to industry officials and analysts watching the effort.

Fearing that the megabanks might get off too easy in the multi-state mortgage settlement talks, Massachusetts Attorney General Martha Coakley is preparing to file lawsuits against the nation's largest servicers for wrongfully foreclosing on customers.

Fannie Mae, to date, has always seemed more aggressive than Freddie Mac in pressing major lenders to repurchase problem loans. Fannie has continually ratcheted up its requests for servicers to buy back loans, while Freddie has reduced its requests over the past four consecutive quarters.

Fitch Ratings has found more than one-third of loans underlying prime private-label mortgage-backed securities are now underwater, and it could get even worse.

Three quarters of commercial real estate executives surveyed by KPMG LLC said distressed real estate would have an impact on their investment strategies over the next 12 months.

Rep. Elijah Cummings, D., Md., ranking member of the House Oversight Committee, and other members of Congress are set to meet with GSE regulator Ed DeMarco Thursday afternoon to discuss President Obama's yet-to-be released refinancing plan.

An analyst for FBR Capital Markets thinks Walter Investment Management could see the servicing rights for more loans coming to it from the Bank of America/Fannie Mae transaction.