Government

Freddie Mac sent a letter to investors regarding bulk sales of foreclosed homes. The GSE offers investors the opportunity to purchase properties in bulk from HomeSteps - a division of Freddie Mac that offers sales of the GSE's foreclosed properties. The GSE says it has found most investors are interested in purchasing at 40 to 60 cents on the dollar below current list price, but Freddie is not considering such significant price cuts. The GSE says it is ""extremely mindful"" of how its pricing affects the market.

At a hearing before a Senate subcommittee this week, witnesses urged Congress to help more underwater homeowners refinance their loans at current, record-low interest rates. The Home Affordable Refinance Program (HARP) allows underwater homeowners with mortgages backed by Fannie Mae and Freddie Mac to refinance their mortgages at lower interest rates. However, the program has helped fewer than 900,000 of the more than 10 million underwater homeowners in the country.

Several servicers remain below median performance level as of the first half of the year, as ranked by Fannie Mae's Servicer Total Achievement and Rewards (STAR) Program. Fannie Mae announced the STAR Program in February to measure servicers' success in providing sustainable solutions to distressed homeowners. The mid-year results released Wednesday by the GSE indicate that only four out of the 11 banks in Peer Group 1 are on track to receive at least a three-STAR rating at the end of the year.

While servicers attempt to develop processes to implement the single point of contact (SPOC) requirement that is part of the Federal Housing Finance Agency's Servicing Alignment Initiative, technology companies have developed solutions to address the new regulation. Representatives from several of these companies spoke about the issue during a panel discussion at the Five Star Default Servicing Conference and Expo. They say collaboration between industry partners is key to overcoming logistical challenges.

New Jersey's Superior Court has lifted the last of six injunctions handed down late last year, giving Ally Financial and its GMAC Mortgage unit the go-ahead to resume foreclosure actions in the state. The Superior Court judge issued an order this week stating that GMAC had demonstrated the ""reliability of its processes"" and is ""permitted to resume prosecution of uncontested foreclosure proceedings."" Five other servicers were given the green light to begin the regular order of processing foreclosures in the state last month.

While the Obama administration is still working through the specifics with the Federal Housing Finance Agency (FHFA) on how to open up refinancing to more borrowers, Keefe, Bruyette and Woods - an investment bank specializing in financial services - notes the most likely course of action is a moderate expansion of the Home Affordable Refinance Program (HARP) rather than a broad refinance program. Even a HARP expansion is likely to be modest at best, the research said.

Fannie Mae last week opened a mortgage help center in Sacramento, California, to provide free education and counseling services to struggling local homeowners with Fannie Mae-owned mortgages. The facility is Fannie Mae's 10th mortgage help center across the country. The GSE developed the center in partnership with NeighborWorks HomeOwnership Center Sacramento Region, which staffs the office, as well as with local community and elected officials and area mortgage servicers.

Former President George W. Bush addressed an audience of participants throughout the default servicing industry Tuesday morning at the Five Star Default Servicing Conference and Expo. Touching on a few challenging moments in his presidency, including the September 11 attack, Bush said, ""You have to surround yourself with people whose judgment you trust."" Bush discussed the difficult decision to administer TARP in 2008.

The Senate Banking Committee held a hearing Tuesday on housing finance reform, the first of three housing-related hearings on the agenda this week. The issue of government guarantees for home mortgages came under some fire. One witness with the American Enterprise Institute in Washington, D.C. noted that without any change in policies and without any further increase in the GSEs' debt, the national debt will reach $30 trillion in 10 years.

The Office of the Comptroller of the Currency (OCC) appointed the FDIC receiver of the First National Bank of Florida late Friday evening, making it the 71st FDIC-insured institution to go under this year. The OCC said it acted after finding that the bank ""had experienced substantial dissipation of assets and earnings due to unsafe or unsound practices."" CharterBank out of Georgia agreed to take over the failed bank's operations.