News

Fannie Mae and Freddie Mac have both updated their seller guides to incorporate the Consumer Financial Protection Bureau's Ability to Repay rule under the Truth in Lending Act. The Federal Housing Finance Agency (FHFA) worked with the GSEs to update their respective seller guides in alignment with one another. The basic goal of the ""Ability to Repay"" rule is to ensure lenders act in good faith that a borrower can repay his or her loan before offering the loan.

After examining practices from mortgage servicers, the Consumer Financial Protection Bureau (CFPB) found servicing problems such as disorganized account transfers and loss mitigation mistakes, according to a report. The CFPB's report was based on the examination of bank and non-bank servicers from November 2012 and June 2013. When pinpointing problems with mortgage servicing transfers, the CFPB identified risks that could lead to missed payments from consumers.

Fannie Mae's Economic & Strategic Research group expects economic growth to gain momentum in the later half of the year following a slow start. Looking ahead, the group expects GDP growth will average 2.0 percent for the year, accelerating to 2.6 percent in 2014 as fiscal drags peel away and the housing recovery continues. According to Fannie Mae chief economist Doug Duncan, ""[t]he biggest risk to this forecast is the expected reduction in the Federal Reserve's asset purchases.""

The number of filings related to suspicious activity for mortgage loan fraud fell year-over-year, while mortgage fraud related to foreclosure rescue scams spiked, according to a recent report from the Financial Crimes Enforcement Network (FinCEN). Last year, mortgage loan fraud (MLF) suspicious activity report (SAR) filings decreased to 69,277, down 25 percent from 92,561. However, the number of MLF SARs related to foreclosure rescue scams increased to 4,427, up 58 percent from 2,799 in 2011.

Altisource Portfolio Solutions, a global provider of services for the real estate, mortgage, and consumer debt industries, announced plans to acquire Equator, a solutions provider for the mortgage and real estate industries. The deal is valued at $70 million on closing and includes contingent earn out consideration of up to $80 million over three years, according to the announcement. Equator will still retain its name, offices, and management team after the acquisition, which is expected to close within 30 days.

Existing-home sales soared 6.5 percent in July to an annual sales rate of 5.39 million--the highest level since November 2009--as the price of a single-family home slipped 0.2 percent, the National Association of Realtors (NAR) reported Wednesday. Despite the month-over-month decline, the median price of an existing-home was $213,500, 13.7 percent ahead of the price in July 2012. It was the strongest yearly price gain since October 2005.

National default rates inched up in July, with first mortgages showing a slight increase, according to the S&P/Experian Consumer Credit Default Indices. For the first time this year, the default rate for first mortgages increased. In July, the default rate was 1.25 percent, up from 1.23 percent in June. The first mortgage default rate though is still down compared to July 2012, when it was 1.41 percent.

The California real estate market continued to experience rising home prices and strong sales in July, but negative equity still remains a significant challenge, according to a report from PropertyRadar. Out of the 6.8 million California homeowners with a mortgage, 26 percent, or 1.8 million, were underwater as of July. Another 500,000 are barely managing to stay above water, with no more than 10 percent of equity in their home. This means about one third, or 2.3 million homeowners, are still unable to sell due to lack of equity.

A former chief appraiser from TriMavin, an AMC, is suing the company and Stearns, its parent corporation, alleging the companies violated federal regulations and terminated her employment in response to her complaints. According to the complaint, Stearns developed a program to recruit mortgage brokers and loan officers by telling prospective recruits they could provide their own personal list of appraisers to be included on the approved panel for the appraisal process at TriMavin.

Median home prices dipped month-over-month in July, but still experienced a sharp rise from last year, according RE/MAX's latest housing survey covering 52 metropolitan areas. Homes in July sold for a median price of $189,950, down 2.1 percent from June, but up by 11.5 percent from July 2012. While inventory was down compared to last year and the prior month, the decreases were more conservative, which means home price gains should slow, according to RE/MAX.