Loss Mitigation

The Federal Housing Administration (FHA) has just $3.5 billion in its capital reserve account. The decline, though, is the result of a shuffling of funds. FHA moved $9.8 billion from its capital reserves to its financing account, the fund used to cover insurance claim payouts and losses. The transfer bumped this loss reserve account up to $29.6 billion and suggests that the FHA may be preparing for another wave of defaults and mortgage insurance claims, although so far this year, claims are coming in well below projections made at the end of 2009.

First American Financial Corporation reported Tuesday that its net income during the second quarter was $33.8 million, or 32 cents per share. The Q2 profit posted by the title insurance and settlement company follows its spin-off from CoreLogic just two months ago and represents an 18 percent increase compared to a year earlier. First American says its average revenue per order increased 20 percent, thanks to a shift in the order mix to higher premium resale transactions.

The real estate software firm eBrokerHouse recently announced the launch of the company's latest software solution -- EBH Office Solution. The company explained that the new Web-based software allows entire real estate agencies to implement the eBrokerHouse back office management system and operate completely virtual and nearly paperless.

Fannie Mae has rolled out a new interactive online resource for homeowners struggling with their mortgage payments. It's KnowYourOptions.com, and it's designed to be a virtual one-stop-shop for anyone facing financial hardship and in need of foreclosure assistance. Eight months in the making, the site offers tools and guidance for refinancing, repayment plans, forbearance, modifications, Fannie Mae's Deed-for-Lease program, short sales, and deeds-in-lieu.

The number of modifications on commercial real estate loans held in securities trusts has accelerated dramatically in 2010, according to Trepp LLC. So far in 2010, loan modifications have already surpassed the total number of mods done in 2008 and 2009 combined, Trepp reports. At this pace, 2010 modifications are set to triple those completed last year, and with servicers stepping up resolutions of troubled commercial loans, increases in delinquency numbers are beginning to moderate.

Deceptive mortgage relief marketers continue to prey on financially distressed homeowners, but one such company has been stopped in its tracks. Home Assure, LLC, has been charged by the Federal Trade Commission for deceiving consumers with promises that it could save their homes from foreclosure. To settle these charges, the company must refund customers $2.4 million, and it can no longer sell mortgage loan modification or foreclosure relief services.

Rumors of a new government-led mortgage refinancing program have begun to surface. DS News has received word from sources inside the administration and from high-ranking executives at some of the largest banks, confirming that the White House is indeed considering a refi push that would allow homeowners to lower their monthly mortgage obligations by locking in today's rock-bottom interest rates. Some industry insiders are viewing the move as a concession by the federal government that its existing housing programs aren't doing enough.

Fannie Mae has opened a mortgage help center in the Windy City in order to provide counseling and other services for struggling homeowners in the greater metro area with loans owned by the GSE. The new center in Chicago is the second facility and third announced partnership in Fannie Mae's planned series of mortgage help centers across the country. The GSE said it partnered on this initiative with Neighborhood Housing Services of Chicago, major mortgage servicers, and civic and community leaders from across the region.

HUD recently announced the availability of $79 million in grants for a broad range of housing counseling programs to help families find and preserve housing. This represents an increase of $21 million, or 27 percent, over last year's funding. According to HUD, these grants will be awarded competitively to approximately 550 HUD-approved counseling agencies and state housing finance agencies across the nation to help families stave off foreclosure, avoid mortgage scams, and improve their credit scores.

The percentage of loans 90 or more days past due held by the nation's largest mortgage company has declined for three months in a row. According to a new monthly summary report released by Fannie Mae on Friday, the GSE's single-family serious delinquency rate dropped 15 basis points to 5.15 percent in May. That follows a decline of 17 basis points in April and 12 basis points in March. The March reading was the first time Fannie's delinquency rate had dropped since March 2007, when it was a mere 0.62 percent.