News

About 50 percent of the loans held by Fannie Mae and Freddie Mac come from the nation's four largest banks - Bank of America, JPMorgan Chase, Wells Fargo, and Citi. Lately, the GSEs have become more aggressive in forcing originators to buy back bad loans. Based on Fannie and Freddie's current ""distressed"" numbers (a combined $354 billion in delinquent mortgages and REOs), Fitch Ratings estimates that the big four could be on the hook to repurchase as much as $180 billion in nonperforming assets.

Real estate prices on U.S. commercial properties dropped 4 percent in June, according to data released by Moody's Investors Service Thursday. The decline followed two months of price increases, illustrating that ""performance remains choppy"" in the commercial real estate sector, the New York-based ratings agency said. Moody's index is now 41.4 percent below the peak that was recorded in October 2007, but 4.2 percent above the recession low that occurred in October 2009.

The number of permanent Home Affordable Modification Program (HAMP) mortgage restructurings completed by Bank of America through July has reached more than 76,000, a number that BofA says continues to lead the industry. In addition, nearly 100,000 Bank of America customers have received non-HAMP modifications this year, including many that did not qualify under the federal program. BofA also reported that it completed 25,000 short sale transactions during the second quarter of this year.

Las Vegas-based real estate software firm eBrokerHouse has announced that its users have closed over $1 billion in traditional, REO, and short sale transactions since the company launched its Web-based management software just 16 months ago. The company's president, Thomas Moore, credits the ability of their software to manage all types of listings, buyers, and virtually every aspect of an agent's business as a main reason why eBrokerHouse hit this milestone so quickly.

SMART Servicing, LLC, an affiliate of Steel Mountain Capital Management, recently announced the availability of its new privately owned software, ""SMART""--Servicing Management Asset Recovery & Tracking. The system provides residential mortgage professionals with relevant loan-level information to control loss severity, as well as asset-level transparency outside the traditional servicing system formats, the company says.

Mortgage fraud has become more prevalent over the past couple of years as perpetrators look to capitalize on deteriorated market conditions. But a new study released by Interthinx this week indicates that mortgages are now less likely to involve fraud than they were during the first part of this year. The company says its national mortgage fraud risk index declined 3 percent during the second quarter, but Interthinx warns that areas already feeling the effects of past fraudulent transactions are finding mortgage fraud hard to eradicate.

Clayton Holdings has announced the hiring of Scott H. Kramer, a 24-year veteran of the real estate industry, as director of commercial default servicing. Clayton Holdings provides customized risk analysis, loss mitigation, operational solutions, and staffing services to the mortgage industry. Kramer will work to expand the commercial real estate special servicing business in the company's Quantum Servicing unit in Tampa, Florida.

Mortgage interest rates dropped again this week, according to data released Thursday by Freddie Mac. The GSE says for yet another week, fixed-rate mortgages reached new record lows. Rates for 30-year mortgages are now averaging 4.42 percent, while 15-year fixed mortgages are at 3.90 percent. Amy Crews Cutts, Freddie Mac's deputy chief economist, says investors in long-term bonds appear confident that inflation will remain in check, which in turn has helped to push mortgage rates even lower.

A federal judge is refusing to sanction an agreement between Citigroup and the Securities and Exchange Commission (SEC) to settle charges that the company misled investors about its exposure to subprime home loans, even as the subprime market began to unravel. Citi agreed to pay a $75 million penalty to settle the charges, but at a hearing this week, a U.S. district judge asked how the parties could expect her to ""find this reasonable and fair.""

The industry has completed about 975,000 permanent loan modifications so far in 2010, according to estimates released this week by the HOPE NOW Alliance. Of those, only a third have been processed under the umbrella of the federal government's Home Affordable Modification Program (HAMP). Two-thirds have been servicers' own proprietary mod programs. HOPE NOW also reports, though, that servicers have initiated more than 1.2 million foreclosures this year.