News

Rep. Bill Posey (R-Florida) has introduced legislation to support the sale of REO homes. His bill, The Housing Recovery Act of 2011, would amend the Internal Revenue Code of 1986 to exempt retirement plan distributions from early withdrawal penalties as long as the money is being used to purchase a residence that has been in foreclosure for a year or more.

Lender Processing Services (LPS) reports that the nation's mortgage delinquency rate plunged to 7.78 percent at the end of March. That figure includes loans that are at least 30 days past due but not yet in foreclosure. March's delinquency rate is down nearly 12 percent from the month before and 20 percent below a year ago. At the same time, though, the nation's foreclosure rate edged up to 4.21 percent. Altogether, LPS says there are 6,333,000 homes in the U.S. that are delinquent or in foreclosure.

An appellate court has given judges of the foreclosure court system in Lee County, Florida, 20 days to respond to a petition filed by the American Civil Liberties Union (ACLU), which alleges the county circuit courts ignore procedural safeguards in order to rush foreclosures through and clear out their backlog of cases. The ACLU says this special ""mass foreclosure docket"" in Lee County sees as many as 200 cases a day, a pace that ""systematically denies homeowners an opportunity to defend their homes against foreclosure.""

The Federal Trade Commission (FTC) has mailed 1,410 refund checks totaling $2.3 million to consumers allegedly defrauded by Home Assure LLC, a so-called mortgage foreclosure rescue service. The FTC alleged that the company charged consumers an up-front fee of $1,500 to $2,500, and falsely claimed its ""special"" relationships with lenders would enable the company to secure favorable loan modifications or stop foreclosure altogether - promises the federal agency says the company did not keep.

John McGeough and Anthony Lamacchia, founders of McGeough Lamacchia Realty Inc. traveled to Washington, D.C., last week to educate policy makers on the benefits of short sales. McGeough Lamacchia Realty is a full-service real estate firm in Waltham, Massachusetts, specializing in short sales. The company's two principals conducted meetings with officials at Capitol Hill, the FDIC, the U.S. Treasury, and the National Association of Realtors.

The Federal Reserve Board on Tuesday requested public comment on a proposed rule under Regulation Z that would require lenders to determine a borrower's ability to repay a mortgage before making the loan and would establish minimum mortgage underwriting standards. The revisions to the regulation, which implements the Truth in Lending Act (TILA), are in response to new consumer protection directives laid out by the Dodd-Frank Reform Act. The proposal provides four options for complying with the ability-to-repay requirement.

Industry data released this week shows that the dollar volume of mortgage loans associated with fraud has dropped to a three-year low, cut by more than half over the past 12 months to $900,000. Likewise, the number of fraud cases tracked has declined to push the index to its lowest level since early 2008. The drop coincides with the U.S. Department of Justice's late 2010 sting involving 120,000 fraud victims who lost more than $8 billion. However, recent activity suggests the lull might only be temporary.

Washington Governor Chris Gregoire signed the Foreclosure Fairness Act of 2011 into law Thursday. The new law goes into effect July 13. It gives homeowners facing foreclosure access to housing counselors, including meeting with the bank and an independent mediator to review options to keep their homes. Support for such mediation will be funded, at least in part, by lenders, who will pay a $250 fee for every new notice of default they file.

Aklero Risk Analytics, Inc., a Pennsylvania-based provider of automated data and document validity assurance for the mortgage industry, has appointed Richard J. Downing as EVP of sales. Downing is a veteran of the mortgage and consumer data industries, with more than 30 years' experience in working to deliver technology-based consumer lending solutions to residential and equity lenders.

Citigroup Inc. said Monday that it pulled in net income of $3.0 billion for the first quarter of 2011. The bank's profit declined $1.4 billion from the first quarter of 2010, but more than doubled compared to the final three months of last year. Even with the year-over-year drop, the lender's Q1 earnings beat analysts' expectations. Citi reported that the company's net credit losses declined 25 percent from a year earlier to $6.3 billion, as credit quality continued to improve for the seventh consecutive quarter.