News

The U.S. Department of Veterans Affairs (VA) has issued a notice announcing regulatory changes for modifying VA-guaranteed home loans. According to the department, the new rule makes VA loan modifications more flexible and encourages loan holders to modify more loans. It changes the requirements related to maximum interest rates allowed on modified VA loans and the items that can be capitalized into the modified loan amount.

HSBC Holdings has suspended all foreclosure actions in the United States, according to the company's annual regulatory filing with the Securities and Exchange Commission (SEC). HSBC says it decided to temporarily halt foreclosure proceedings after examinations by federal regulators uncovered what the company described as ""deficiencies"" in its handling of legal paperwork related to foreclosure cases. HSBC is Europe's largest bank. It operates in the United States as HSBC Finance and HSBC Bank USA.

Fannie Mae issued a servicing guide update Tuesday, which adds 14 additional states to the GSE's list of jurisdictions in which its servicers must use one of the legal firms approved by Fannie Mae to handle all foreclosure and bankruptcy matters. As specified by the GSE, the firms within its retained attorney network must handle all issues relating to mortgage loans held in Fannie Mae's portfolio as well as certain securities. As of now, the District of Columbia and all states except for six are subject to the GSE's retained attorney requirements.

Two more rulings have defended the right of Mortgage Electronic Registration Systems (MERS) to foreclose on behalf of lenders. A case in New Hampshire and another in California affirmed the right of the company to act as a nominee on behalf of its members and foreclose on properties. In recent weeks, courts in Massachusetts and Kansas have also upheld the standing of MERS in foreclosure cases, although a New York court ruled MERS cannot act on behalf of lenders.

According to Empowering and Strengthening Ohio's People, a non-profit foreclosure prevention counseling agency, the Ohio Housing Finance Agency's failure to distribute funding - in addition to federal budget cuts - means turning away some homeowners. Starting Tuesday, the agency says it will be forced to stop taking in homeowners referred from the National Foreclosure Mitigation Counseling program.

The U.S. Department of the Treasury on Monday exercised its right to appoint a member to the Ally Financial Inc. board of directors, naming John D. Durrett of the investment firm Serent Capital. Treasury also announced Tuesday that it will sell some of the $2.7 billion in trust preferred securities (TruPs) received from Ally as part of the government's bailout of the mortgage and auto lender.

Treasury Secretary Timothy Geithner told lawmakers Tuesday that the government played a role in bringing down the housing market. He also blamed the government for creating moral hazard and leaving taxpayers responsible for cleaning up the mess, and said the government made mistakes that were avoidable. As part of his pitch to lawmakers for housing finance reform, Geithner stressed that fundamental change is needed -- change that is based on a shift of what many believe is the ""American Dream.""

New Vista Asset Management announced Tuesday that it has purchased the REO asset management business unit of REDC Default Solutions, LLC. Terms of the transaction were not disclosed. The asset management unit, previously operated within REDC, which is a wholly-owned subsidiary of Irvine, California-based Auction.com, LLC(formerly Real Estate Disposition, LLC), offers outsourced residential asset management services for banks and other financial institutions.

Romspen Investment Corporation, the largest non-bank lender in Canada, will use the Mortgage Office from Applied Business Software Inc. (ABS) to administer its commercial loan portfolio and manage its mortgage investment fund. ABS is a Los Angeles-based global provider of software systems to the lending industry. Romspen's current portfolio is $500 million, and the company's mortgage investment fund has thousands of investors.

Proctor Financial, Inc., a Michigan-based provider of lender-placed hazard insurance for borrower and bank-owned properties as well as related services, has received the ISO 9001:2008 certification. According to a statement from the company, its objective in seeking the certification was to monitor, control, and continually improve the quality of its lender-placed insurance processes pursuant to the ISO 9001:2008 standards.