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Trepp: Loss Severities, Volume of CMBS Loans Liquidated Increase

Almost $1.4 billion in commercial mortgage-backed securities (CMBS) conduit loans were resolved with losses in May, according to Trepp LLC. That number was up about 11 percent from April and was the second highest total since the company began tracking this stat in January 2010. During the month of May, 148 loans with a total balance of $1.38 billion were liquidated. The losses on the May liquidations were about $594 million, representing an average loss severity of 43.2 percent.

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Ocwen Launches Turnkey Operation for Distressed Mortgage Buyers

Specialty servicer Ocwen Financial Corporation recently launched a new product to help buyers of non-performing loan portfolios or residuals of private-label securities get more value from their loans. A turnkey product, PlatformPlus allows distressed asset investors to set up their own specialty servicing operations using Ocwen's expertise and management.

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GSEs’ Foreclosure Prevention Efforts Slip in First Quarter

Foreclosure prevention actions on loans held by Fannie Mae and Freddie Mac declined during the first three months of this year, driven primarily by loan modifications. Permanent loan mods dropped for the third consecutive quarter to 86,201. Short sales were essentially flat at 25,705. According to the GSEs' regulator, even with the drop-off in loss mitigation actions the two companies' delinquency rates ""remain below industry levels."" In the first quarter, foreclosure starts declined while completed foreclosures increased.

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Fannie Mae Issues New Servicing Standards for Delinquent Mortgages

Fannie Mae laid out new standards for mortgage servicers Monday related to the management of delinquent loans. The move is part of the Servicing Alignment Initiative announced by the company's regulator in late April to bring both Fannie Mae's and Freddie Mac's procedures for handling past-due mortgages in line with one another. The new rules are intended to address identified servicing issues such as the commencement of foreclosure actions while loss mitigation talks are ongoing and breakdowns in borrower communication.

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Fannie and Freddie to Need $42B More in Taxpayer Subsidies: CBO

Provided they live on in their current form, Fannie Mae and Freddie Mac will need another $42 billion from taxpayers over the next decade, according to the Congressional Budget Office (CBO). The agency says subsidies related to the GSEs' new business have fallen but they'll continue to need funding as long as their mortgage guarantees are priced below private institutions. CBO says the government faces two choices: either retain the GSEs' portfolios until the mortgages are paid off, or pay a private entity to assume the guarantee obligations.

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Fitch Reports CMBS Special Servicing Volume Trending Down

The rate at which distressed loans held in U.S. commercial mortgage-backed securities (CMBS) are being transferred to special servicers continues to decline, according to Fitch Ratings. The agency reports that approximately $85.7 billion in loans were being worked out by special servicers as of the first quarter of 2011. Specially serviced CMBS loans reached a peak in the second quarter of 2010 at $91.2 billion. But Fitch has noticed a declining trend ever since and the agency expects it to continue.

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Goldman Sachs Subpoenaed Over Subprime Mortgage Trading

Prosecutors with the Manhattan District Attorney's office have issued a subpoena to Goldman Sachs for information related to the company's trading of mortgage bonds backed by subprime loans. The action against the Wall Street institution stems from a congressional report issued in April by a Senate subcommittee on the key causes of the financial crisis. The U.S. Justice Department, SEC, and New York's attorney general have reportedly launched their own investigations into Goldman's dealings during the run-up to the mortgage meltdown.

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Trepp: CMBS Delinquencies Retreat in May After Record-Setting April

The delinquency rate on loans held in commercial mortgage-backed securities (CMBS) fell slightly in May from the new record high set the month before, according to Trepp LLC. The research firm says the percentage of CMBS loans 30 or more days delinquent, in foreclosure, or REO has fallen back 5 basis points to 9.60 percent. Trepp says while it seems small, May's decline is actually the biggest rate drop in about two years. The value of delinquent loans within commercial mortgage bonds now stands at $61.5 billion.

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Seriously Delinquent Home Mortgages Continue to Drop for the GSEs

Fannie Mae and Freddie Mac have both reported another drop in the share of single-family home mortgages they hold that are 90 or more days delinquent. Fannie's serious delinquency rate declined 17 basis points to 4.27 percent. Freddie's fell 6 basis points to 3.57 percent. Except for one blip of an increase last September for Freddie, the GSEs have seen their serious delinquencies fall for 12 months. The servicing alignment initiative announced by the two companies is expected to speed the resolution process for past-due loans.

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Fannie and Freddie May Sell Modified Loans

Modified mortgages held by Fannie Mae and Freddie Mac could go up for sale at some point, according to the companies' regulator. Since the GSEs were seized by the government, they have completed modifications on 849,000 mortgages. The sale of these assets is one option being discussed as part of a strategy to shrink their portfolios. The head of the Federal Housing Finance Agency told lawmakers that they are looking at a range of possible structures for disposing of certain assets, which could include non-performing and modified loans.

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