Loss Mitigation

First time claims for unemployment insurance fell to 339,000 — the lowest level since February 2008 — for the week ended October 6, the Labor Department reported Thursday. The drop was far steeper than market expectations of 370,000 initial claims.

Three mortgage relief companies are in hot water after the Federal Trade Commission (FTC) charged them with using deceptive tactics to prey on distressed homeowners. The FTC filed three separate suits against Prime Legal Plans, American Mortgage Consulting Group, and Expense Management America for allegedly violating its Mortgage Assistance Relief Services (MARS) Rule, which prohibits certain practices commonly used by fraudulent mortgage assistance companies.

The long-running legal proceedings between MBIA Insurance Corporation and Countrywide Home Loans (acquired in 2008 by Bank of America) turned into a blame game Friday as the companies battled over liability for insurance losses on bad loans.

Equifax and its customers reached separate settlements with the FTC, agreeing to pay a total of $1.6 million for improper sale of consumer credit information. The FTC alleges Equifax sold more than 17,000 lists of people who met specific criteria, such as being late on their mortgage payments. Equifax is said to have sold the lists to Direct Lending Source, Inc., which in turn sold the lists to other third parties. The lists included information such as credit scores and detailed how many days past due consumers' mortgage payments were.

Inflated appraisals were identified as one of the causes of the housing bubble, and now undervalued appraisals are viewed as a reason for a stalled recovery. In a National Association of Realtors survey related to home appraisals over the past three months, 11 percent of Realtors said a contract was cancelled because a home was appraised at a value below the negotiated price. One reason for the low values, according to the NAR, is because some appraisers are not taking into account the difference between distressed and non-distressed homes when making comparisons.

The Federal Housing Finance Agency released a revised Strategic Plan for the years 2013 through 2017 Tuesday. The plan is a modified version of the plan FHFA Acting Director Edward DeMarco presented to congress in February. The plan details four major goals for the FHFA over the next few years. The first goal is to ensure ""safe and sound housing government-sponsored enterprises.""

The U.S. government is suing Wells Fargo over what officials allege constitutes more than 10 years of misconduct as a direct endorsement lender for the Federal Housing Administration (FHA). The civil fraud suit was filed in federal court Tuesday and alleges Wells Fargo falsely certified the credit and underwriting quality of FHA loans it originated. According to the complaint, thousands of Wells Fargo's FHA-insured mortgages defaulted as a result of deficient underwriting, causing the government agency to lose hundreds of millions of dollars.

After rounding out its fourth military homeowner event, HOPE NOW announced more events are to come. In September, HOPE NOW hosted an event in Fort Bragg, North Carolina, which attracted 60 attendees, and another event at joint Base Lewis-McChord in Washington, where 142 military families were able to receive assistance.

MortgageKeeper Referral Services announced Tuesday that it will begin working with Family Credit Management to help its counselors connect consumers to vetted community services via MortgageKeeper's MKDesktop product. Family Credit Management is a nonprofit consumer credit and housing counseling agency licensed in over 20 states. It's counselors will now have Web-based access to MortgageKeeper's nationwide database of more than 6,500 nonprofit and government services.

The shadow inventory that previously darkened industry outlook is beginning to fade. In fact, we may soon begin to see the sunlight on the horizon. In July shadow inventory - unlisted homes that are seriously delinquent, in foreclosure, or held as REOs - declined 10.2 percent year-over-year, falling to 2.3 million homes, according to CoreLogic's Shadow Inventory Report released Tuesday. Seriously delinquent homes – those 90 or more days delinquent – are the most common type of home in today's shadow inventory, making up 1 million of the 2.3 million-home total.