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The principal reduction debate resurfaced after 45 members of the House of Representatives sent a letter to President Obama, urging him to replace Federal Housing Finance Agency (FHFA) Acting Director Edward DeMarco with a permanent director. DeMarco was mainly criticized for his resistance to a loan modification pilot program that would ""examine whether a principal reduction program could reduce costs to taxpayers while helping borrowers stay in their homes.""

Atlanta, one of the metros hardest hit by the foreclosure crisis, has experienced an uptick in the role investors play in its housing market. Also, since the foreclosure crisis, the investors' activities and strategies in the market have shifted, according to a new report from Harvard's Joint Center for Housing Studies. At the start of the foreclosure crisis, investors stepped into the Atlanta market to buy up REO properties and flip them. However, starting in 2008, more investors began shifting their focus to renting their REO purchases.

In Fannie Mae's housing survey for January, consumers maintained their expectation for growth in home and rent prices and also expressed more optimism toward the economy. The January 2013 survey found 41 percent of consumers believe homes prices will rise in the next 12 months, down from 43 percent in December, but up from 30 percent a year ago. As prices continue to climb, more consumers also said now is a good time to sell. The percentage rose to 23 percent in January, up from 21 percent in December and 11 percent a year ago.

First time claims for unemployment insurance continued to move sideways, dropping 5,000 to 366,000 for the week ended February 2, the Labor Department reported Thursday. Economists expected a larger decline to 360,000 from the prior week’s 330,000 initial claims.

As the Federal Housing Administration (FHA) currently holds a negative equity position of $16.3 billion with a capital reserve ratio of -1.44 percent, Congress called on industry experts to discuss FHA's role in the housing market and possible reforms for the future. The hearing took place Wednesday morning before the House Financial Services Committee. The overall sentiment from witnesses was that the FHA as it stands is flawed and in need of reform.

A judge in the Southern District of New York ruled Tuesday that Flagstar Bancorp will have to pay Assured Guaranty Municipal Corp. more than $90 million for defective mortgages packaged in residential mortgage-backed securities (RMBS). U.S. District Judge Jed Rakoff ruled that Flagstar must pay $90.1 million to Assured for misrepresenting loans in insured securities. Flagstar must also pay interest, attorneys' fees, and other costs to be determined.

Realtors in Florida are no stranger to the economic impact of foreclosures. So, it's no surprise that the Florida Realtors addressed the state's judicial foreclosure process in its list of five legislative priorities for 2013. ""Florida Realtors wants to ensure that any alternative procedures designed to speed up the foreclosure process in uncontested or meritless cases have safeguards that protect all parties,"" the group stated.

Freddie Mac partnered with nonprofits to open up three walk-in centers for borrowers who are facing mortgage troubles. The centers were opened Atlanta, Las Vegas, and Los Angeles.

The Justice Department (DoJ) and Standard Poor's are at odds with others over civil fraud charges stemming from an alleged scheme to defraud investors in the lead-up to 2008's financial meltdown. The DoJ filed a civil lawsuit against S&P and its parent company, McGraw-Hill, Monday, alleging that S&P ""knowingly [issued] inflated credit ratings"" for collateralized debt obligations in the years before the crash, misrepresenting their creditworthiness and understating their risks.

Homeowners who refinanced their mortgage loans in the fourth quarter of 2012 reduced their interest rates by an average of 33 percent, a record savings not seen in 27 years of observance, according to Freddie Mac. ""On average, borrowers who refinanced reduced their interest rate by about 1.8 percentage points,"" said Frank Nothaft, VP and chief economist at Freddie Mac. This translates to about $3,600 in annual savings on a $200,000 loan, according to Nothaft.