Government

Timothy Massad has been confirmed by the Senate as Treasury's assistant secretary for financial stability, responsible for overseeing the implementation and wind down of the Troubled Asset Relief Program including initiatives to address the housing and foreclosure crisis. While Treasury has won several Senate confirmations in recent days, the Department is at risk of losing its topmost officer. Treasury Secretary Tim Geithner has notified President Obama that he will resign if lawmakers don't raise the debt ceiling by the early August deadline.

HUD announced a revised Notice of Disclosure form that emphasizes the rights of active duty military and their dependents who are protected under the Servicemembers Civil Relief Act (SCRA). Under the SCRA, military personnel on active duty are entitled to mortgage relief, including a lower interest rate on their mortgages and foreclosure protection. HUD says it is the lender's responsibility to determine military status in connection with a foreclosure.

Freddie Mac has issued a bulletin to servicers announcing changes to the company's default management requirements. The move is part of the Servicing Alignment Initiative announced by the Federal Housing Finance Agency in late April to bring both Fannie Mae's and Freddie Mac's procedures for handling past-due mortgages in line with one another. Freddie also alerted servicers that it plans to roll out a new modification solution for borrowers who defaulted on previous modifications and who are ineligible for HAMP.

The Office of the Comptroller of the Currency has laid out its expectations for national banks' handling of mortgage foreclosures. The federal agency says all servicers under OCC supervision must observe the same stipulations handed down to a handful of servicers in April as part of the regulatory settlement for robo-signing infractions. National banks are directed to conduct a self-assessment of their foreclosure management practices by September 30, and take immediate action to correct any deficiencies.

The man charged with orchestrating possibly one of the most notorious mortgage fraud schemes in U.S. history has been handed a 30-year prison sentence. Lee Farkas, CEO of Taylor Bean & Whitaker, was told Thursday by a U.S. district judge in Virginia that his crimes merit three decades behind bars. Judge Brinkema said she did not detect ""one bit of actual remorse"" in Farkas. From 2002 through 2009, Farkas and his co-conspirators manufactured fraudulent mortgages and securities in a scheme that led to the collapse of Colonial Bank.

The performance of first-lien mortgages serviced by large national banks and thrifts improved in the first quarter as troubled loans worked through the system, according to a report released Wednesday by federal regulators. Their analysis of servicing portfolios as a whole found that loans serviced for government agencies and the GSEs are outperforming those held by banks and thrifts on their own books. Nevertheless, delinquencies improved across all risk categories and for all asset owners, while newly started foreclosures declined sharply.

Freddie Mac has entered into a proposed settlement with the now defunct Taylor, Bean & Whitaker (TBW). Under the terms of the agreement, Freddie Mac will be granted an unsecured claim in the TBW bankruptcy estate for just over $1 billion. The GSE estimates it will only see between $40 million and $45 million from that claim. While the settlement entitles Freddie to additional funds related to its mortgage loans, it also requires the GSE to pay TBW and its trade creditors to settle their potential claims against the GSE.

A total of 25,485 suspicious activity reports (SARs) involving mortgage fraud were submitted to the Financial Crimes Enforcement Network in the first quarter, up 31 percent from a year earlier. The agency attributes the increase to more demands from investors for lenders to repurchase poorly performing mortgages, which have prompted additional loan reviews. Officials also found a number of incidents involving foreclosure rescue scams, false claims of identity theft, and property flopping.

One in 10 residential mortgages in New York City is more than 90 days delinquent or in foreclosure, according to an analysis conducted by the Federal Reserve Bank of New York. The study also revealed that the ratio of New York City borrowers at least three months behind on their payments, but not in foreclosure, has improved from 5.4 percent in February 2010 to 3.8 percent as of March 2011. Mortgage performance statistics were also released for Long Island and Hudson Valley.

Florida's Second District Court of Appeal has denied a petition brought by the American Civil Liberties Union (ACLU) alleging that the state's special ""mass foreclosure docket"" established to help clear Florida's case backlog doesn't allow homeowners an opportunity to defend their homes against foreclosure. The case before the appellate court was viewed as a pivotal one by the advocacy group, although state legislators did not renew funding for these special courts for the 2011-2012 fiscal year, which begins in July.