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Secondary Market

Mortgage Rates Mixed This Week but Expected to Head Lower

Interest rates on home loans offered up a mixed bag of results this week. Freddie Mac says fixed-rate mortgages showed no change or dipped slightly and adjustable-rate mortgages ticked upward. Even with the inconsistencies, rates remain near their record lows. Those lows may drop farther with the Federal Reserve's announcement Wednesday that it's planning a new buying spree of mortgage-backed securities and Treasuries. Leading indicators in the bond market since the Fed's statement suggest mortgage rates will again start falling.

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Commercial Real Estate Prices Increase for Third Straight Month

Commercial real estate prices have increased for three consecutive months, according to Moody's/REAL Commercial Property Price Indices. Prices are now similar to levels recorded two years ago. In July, the national index posted a 5 percent increase. It's now 12.6 percent above its post-peak low, however, it is 42.5 percent below its peak. Moody's sees the latest gain more as a continuation of the bottoming process than as a harbinger of recovery. Sales of distressed assets made up 28 percent of the market in July.

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Home Prices Continue Four-Month Run of Gains in FHFA Study

Home prices rose 0.8 percent between June and July, marking the fourth consecutive monthly increase, the Federal Housing Finance Agency (FHFA) said Thursday. That string of gains is coming off a streak of declines that was three times as long. Prior to April, FHFA's index had been on a slippery downward slope for 12 straight months. FHFA's numbers are calculated using sales price information from mortgages acquired by Fannie Mae and Freddie Mac.

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New Fed Stimulus: Mortgage Bonds and Treasuries on the Shopping List

Driving home its rationale for new stimulus measures, the Federal Reserve on Wednesday reiterated the pains many Americans are living with every day - economic growth remains slow, unemployment remains elevated, and housing remains depressed. With these and other downside risks holding back recovery, the Federal Reserve says it will begin reinvesting its money into mortgage-backed securities issued by Fannie Mae and Freddie Mac, and it will purchase another $400 billion in Treasury bonds.

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CFPB, Other Federal Agencies Developing National Servicing Standards

The Consumer Financial Protection Bureau (CFPB) is working alongside other federal agencies to create ""common-sense national servicing standards,"" according to the Treasury's advisor on the bureau Raj Date. One of the issues Date plans to address through national servicing standards is what he says has been a lack of incentive for originators and others involved in the front end of the lending process to ensure a borrower has the ability to repay their loan.

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FHFA Sounds Private-Sector Mantra With Plans to Raise GSEs’ Fees

Fannie Mae and Freddie Mac will begin raising the fees they charge lenders for guarantees on mortgage loans next year. According to the companies' regulator, it's a step toward readying the market for private-sector reinforcements and weaning the nation's housing sector off of low-cost government support. FHFA's director says it ought to be clear at this point that the two mortgage giants will not be able to emerge from conservatorship. He argues that more progress should have been made on housing finance reform by now.

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Total Mortgage Approved as Fannie Mae Seller and Servicer

Total Mortgage Services, LLC, a Connecticut-based mortgage lender, has received approval from Fannie Mae to be a seller/servicer for one-to-four unit single-family first lien mortgages. The company explained that with the designation it can now retain mortgage servicing rights for GSE loans, as well as sell and pool loans into mortgage backed securities (MBS) and expand its product offerings.

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Banks’ REO Inventories Down by 17%

Banks held about 476,000 homes that they repossessed from delinquent mortgage borrowers as of the end of July, according to Barclays Capital. That tally represents a 17 percent contraction from 574,000 REOs on the books just 10 months earlier, in September of 2010, just as the robo-signing scandal began grabbing headlines. According to Barclays' analysis, the average number of months a loan has spent in foreclosure has climbed from around 10 months just before October of last year to more than 12 months today.

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Gerner & Kearns to Represent FDIC in Four States

Gerner & Kearns, Co., L.P.A. (G&K) recently announced that it has been designated by the FDIC as outside counsel in the states of Indiana, Kentucky, Ohio, and Michigan. The firm's practice areas include foreclosure, bankruptcy, evictions, origination and REO closings, loss mitigation, and commercial litigation with respect to the industry's residential and commercial portfolios.

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CA Rep. Requests Information on Fannie Mae’s Purchase from BofA

Rep. Darrell Issa of California has sent a letter to the Federal Housing Finance Agency (FHFA) expressing his concerns and requesting information about an alleged deal between Fannie Mae and Bank of America. Issa references an August 10th report detailing a deal between Fannie and the bank in which the GSE reportedly purchased the mortgage servicing rights of 400,000 troubled loans for $500 million. Issa says the transaction is ""worrisome"" and appears to have shifted risk from BofA to Fannie Mae.

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