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Moody’s Expects HAMP Missteps to Prolong Home Price Declines

Moody's Investors Service is forecasting another 8 percent decline in home prices before a bottom in property values is reached. That's actually an improvement over previous estimates, but it's the duration of depreciation that's the headline grabber. Last month, Moody's analysts were predicting the price floor to be reached in the third quarter of this year. Now they say it won't be hit until the end of the fourth quarter, largely because of the ""underwhelming"" success of the administration's Home Affordable Modification Program (HAMP).

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WHEDA to Begin Lending Again

Through a partnership with Fannie Mae, the Wisconsin Housing and Economic Development Authority (WHEDA), an independent state authority that works with lenders to provide low-cost financing for housing and small business development, announced Friday that it has re-entered the affordable home loan market after more than a year of not funding single family loans.

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Commercial Real Estate Losses Could Hit $300 Billion: TARP Panel

Losses from defaults on commercial real estate loans maturing in the next few years could go as high as $300 billion, threatening to topple nearly 3,000 community banks nationwide, a federal watchdog group has concluded. Market analysis by the Congressional Oversight Panel, charged with keeping tabs on the government's Troubled Asset Relief Program (TARP), shows that none of the banks classified by federal guidelines as having a ""CRE Concentration"" are among the nation's largest holding companies.

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Wolters Kluwer Helps Mortgage Lenders Embrace H4H Program

Following the recent enhancements to the federal government's HOPE for Homeowners (H4H) program, Wolters Kluwer Financial Services has updated its library of H4H mortgage documents and consumer education materials. HUD's enhanced program includes several provisions meant to increase lender and borrower participation, including reduced program fees, streamlined borrower certification requirements, and new underwriting guidelines.

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Homebuilder Buys $3B in Troubled Real Estate Loans from FDIC

One of America's largest homebuilders is getting into the loan restructuring business. Lennar Corporation has purchased two loan portfolios from the FDIC worth $3 billion. Lennar paid $243 million for the portfolios, which include 5,500 distressed residential and commercial real estate loans from 22 failed banks. The Miami-based builder says acquiring and working out troubled real estate loans was an ""extremely profitable"" part of its business during the last real estate down cycle.

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Bernanke Gives Blueprint for Stimulus Pull-Back

Federal Reserve Chairman Ben Bernanke on Wednesday laid out the central bank's plan for exiting the private credit market and pulling back the trillions of dollars its funneled into the economy to stave off a repeat of the Great Depression. Bernanke stressed that the programs were implemented with no cost to taxpayers, have helped to restart the flow of credit, and are already being ""substantially"" phased out.

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Congressman Introduces Mortgage E-Verify Act for GSE and FHA Mods

Rep. Kenny Marchant (R-Texas) has introduced a new bill, the Mortgage E-Verify Act. As a condition for modification of a home loan held by Fannie Mae or Freddie Mac, or insured by the Federal Housing Administration (FHA), it would require a homeowner to be verified under the E-Verify program, a system run by the U.S. government to certify a person's legal status.

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Fannie Mae to Purchase Delinquent Loans from MBS Trusts

Following in the steps of its sibling company, Fannie Mae has announced that it too will be buying back bad loans from mortgage-backed securities (MBS) investors in bulk. The GSE said it will begin ""significantly"" picking up the pace of its purchases of loans that are at least 120 days past due, beginning in March. Fannie did not disclose an exact dollar amount of the repurchases, but did say that as of December 31, the total of such loans was $127 billion.

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Freddie Mac to Buy Back More than $71B in Delinquent Loans

Freddie Mac said Wednesday that it will purchase ""substantially all"" mortgages that are 120 days or more delinquent from the company's fixed-rate and adjustable-rate mortgage Participation Certificate (PC) securities. With new accounting rules that took effect January 1, the company said it is cheaper to buy and hold these nonperforming loans on its books than to pay guarantee fees to security investors. As of December 31, 2009, the aggregate balance of such loans was just over $71 billion.

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Mortgage Investors Push for Principal Writedowns

Mortgage principal - to cut or not to cut - has grabbed a fair share of the media spotlight in recent weeks, with a number of experts plugging principal reduction as a practicable means of ensuring homeowners don't redefault on their modified loan. While lenders are often prohibited from trimming the principal by agreements with investors, one such group, representing holders of some $100 billion in mortgage securities, is lobbying Congress to enact legislation that addresses the problem of underwater mortgages by reducing the debt.

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