News

After nearly two months with no activity, FDIC's list of bank failures grew by one on Friday with the closure of First Community Bank of Southwest Florida (also operating as Community Bank of Cape Coral).

In June, over 700,000 loans that were once current became newly delinquent, leading to a near 10 percent month-over-month spike in the national delinquency rate, according to a report from Lender Processing Services (LPS). Though, the sudden uptick in delinquencies is actually not surprising when looking at previous trends, LPS found. ""Over the last 18 years, similar changes occurred in June for all but four of those years,"" said Herb Blecher, SVP of LPS Applied Analytics. When examining the increase on a quarterly basis, Blecher also noted the rise was actually moderate compared to previous years.

The Barrett Daffin Frappier Turner & Engel family of law firms has reacquired National Default Exchange (NDeX), NDeX Title, and NDeX West from the Dolan Company. The deal puts the law firms of the BDF Law Group in direct and complete control over their entire operations. Dolan's decision to shed the NDeX assets is in line with the company's plans to move into specialized business technology for law firms and away from business processing and back office services.

""Beauty,"" Lew Wallace, the author of ""Ben Hur,"" once wrote, ""is altogether in the eye of the beholder."" So, it seems, is ""disappointment""-- at least when it comes to describing or characterizing the employment report for July, which showed 162,000 new payroll jobs and a drop in the unemployment to 7.4 percent. The disappointment came not from the unemployment rate--the lowest since September 2008--but from the creation of ""only"" 162,000 jobs. To be sure, the people who are ""disappointed"" are those forecasters who predicted more jobs would be created.

Fannie Mae and Freddie Mac are eliminating the $500 incentive for competed borrower response packages starting August 1, according to separate bulletins issued by the GSEs. The GSEs also announced servicer incentives for Home Affordable Modification Program (HAMP) modifications will increase starting April 1, 2014.

Even though both the United States and Europe experienced price declines starting in 2007, the increase in mortgages default rates over time was much more severe in the United States compared to Europe. For example, in the United States, prices fell 7.7 percent from 2007 to 2008, and default rates spiked 93.2. In Europe, prices fell 6.8 percent from 2008 to 2009, yet mortgage defaults increased by 11 percent. The report authors attributed the difference to two specific regulations used in Europe to prevent mortgage defaults.

Personal spending in June grew 0.5 percent, its fastest pace February while personal income rose 0.3 percent ,the Bureau of Economic Analysis reported Friday. Economists had expected income and spending each to grow 0.4 percent. By the numbers, income grew $45.4 billion, while spending was up $59.4 billion, the largest month-over-month increase since February when spending rose $75.7 billion.

The total balance for seriously delinquent first mortgages decreased to a five-year low as rising home prices reduce incentives to default, Equifax stated in its National Consumer Credit Trends Report. In June, the balance of loans 90 days or more past due or in foreclosure fell to $325 billion, down 27 percent from last year when the balance stood at $450 billion. Loans originated in 2010 or later represented about 7 percent of the balance for seriously delinquent mortgages.

The nation's economy added 162,000 jobs in July as the unemployment rate fell to 7.4.percent, the Bureau of Labor Statistics reported Friday. Economists had forecast payrolls would grow by 175,000 and that the unemployment rate would dip to 7.5 percent. Average weekly hours fell to 34.4, compared with forecasts of 34.5, and average hourly earnings fell two cents. Despite the increase in jobs, the report could have a major negative impact on the broader economy, as it showed more people with jobs but working fewer hours and for less money.

Since helping draft the final rule for a qualified mortgage, former Consumer Financial Protection Bureau (CFPB) Deputy Director Raj Date has resigned from the agency and opened his own advisory and investment firm aimed specifically at ""those borrowers who do not meet the standards for 'qualified mortgages' as set by the CFPB under rules."" Other senior employees at CFPB have also left to join Date, including Gary Reeder, Chris Haspel, and Mitch Hochburg. This turn of events has raised questions as to the agency's ethics and integrity.