The U.S. Department of Housing and Urban Development (HUD) announced Thursday that it is increasing the Federal Housing Administration’s (FHA) conforming loan limits temporarily to provide liquidity to a sluggish real estate market, according to a HUD press release.

The business of auctioning foreclosed homes has hit a legal snag for one California company that is being sued by a competitor for allegedly using deceptive and fraudulent business practices to create a new auction platform.

Merrill Lynch has announced the closing of its mortgage origination platform, First Franklin Corp. action that will result in approximately 650 job cuts. The company also said it’s exploring the option of selling its Home Loan Services mortgage servicing platform.

The Securities and Exchange Commission (SEC) filed a federal lawsuit against Salt-Lake City-based Thompson Consulting Inc., and principals Kyle Thompson, David Condie and Sherman Warner, on Tuesday for engaging in risky hedge fund investment activity that has been tied to subprime-related investments.

As legislators charge forward with proposals on how to fix the current housing market slump, two schools of thought on providing home buyers with tax credits to stimulate home sales have emerged in the marketplace.

The North Carolina Office of the Commissioner of Banks (NCCOB) announced this week that Ryland Mortgage, the lending affiliate of builder Ryland Homes, has agreed to pay certain North Carolina homeowners a total of $220,851 in compensation because of allegations claiming the lending unit overcharged based on state lending standards.

The Minnesota House and Senate released a joint proposal Wednesday that would stall foreclosures in the state by either giving borrowers a chance to become timely with their payments through a 65-percent reduction in their minimum payments after default sets in or by allowing them to keep the original minimum payment to stop the onset of foreclosure.

New York Governor Eliot Spitzer announced a new legislative proposal on Tuesday that’s designed to tackle predatory lending while also addressing the state’s rise in foreclosures. Under the governor’s proposal, lenders would be required to issue pre-foreclosure notices 60 days before filing legal action against a property and to participate in settlement conferences in which foreclosure matters could be resolved at the beginning of the default process, according to a press release issued by Spitzer’s office.

Tampa, Florida-based Mortgage Contracting Services (MCS), a property preservation and inspection services provider, said this week that Paul Swindle and Michelle Hickman have been named assistant vice presidents within the company.

Hutchens, Senter & Britton, a North Carolina law firm working in the areas of foreclosure and creditors’ rights, has hired Gwynne Booth as an associate. Booth will serve in the areas of civil litigation, creditors’ rights and business law.