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Mortgage Banker Production Profits Narrow Further in Q1 2010

Profit margins for independent mortgage bankers and subsidiaries continued to fall in the first quarter of this year, as production volume declined and production operating expenses rose, the Mortgage Bankers Association (MBA) reported Tuesday. According to MBA's quarterly survey, independent mortgage bankers and subsidiaries made an average profit of $606 on each loan they originated in Q1, down from $890 per loan in the fourth quarter of 2009 and substantially lower than the $1,088 average profit recorded one year ago.

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S&P/Experian Index Shows Mortgage Defaults Down 45% from 2009

Data through June 2010, released Tuesday by Standard & Poor's and Experian points to a declining trend in consumer default rates, with a reduction in first mortgage past dues leading the drop. Based on data extracted from Experian's database of approximately $11 trillion in outstanding loans, first and second mortgage default rates were 3.3 percent and 2.4 percent, respectively, as of the end of last month. The companies say default rates on first mortgages are down 45 percent from a year ago; second mortgage defaults have dropped 44 percent.

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HAMP Mods Increase Again in June as Big Four Banks Lead the Way

Bolstered by the big four banks' loss mitigation efforts, the total number of active permanent modifications completed under the Home Affordable Modification Program (HAMP) jumped to 389,198 as of the end of June. Servicers completed 51,205 permanent modifications during the month, and more than half - 26,525 - of these were initiated by the nation's four largest banks - Bank of America, Wells Fargo, JPMorgan Chase, and Citi.

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HAMP Redefault Rate Less Than 2% After Six Months

New data from the Treasury shows that the redefault rate for the Home Affordable Modification Program (HAMP) is far lower than many critics have projected and well below typical industry averages. According to the July report, the re-default rate (90 or more days past due) for homeowners in permanent modifications for at least six months is 1.7 percent. The latest figures from the OCC put the redefault rate of mortgages modified by the nation's 11 largest servicers - incorporating proprietary mod programs - at 57 percent.

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PMI Slashes Home Sales Forecast by More Than 50%

Mortgage insurer PMI has cut its growth projections for 2010 home sales by more than half. The company's analysts now expect sales of existing homes to rise a modest 2.9 percent for the year to 5.31 million units. That's a sharp drop from a mere month ago, when they predicted a 6.1 percent gain. PMI says the falloff in sales now that the tax credit is gone suggests even record low mortgage rates and attractive pricing aren't enough to elevate demand in today's market.

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Bank of America Opens Customer Outreach Center in New England

In an effort to further serve financially troubled homeowners in New England, Bank of America Home Loans has opened a new customer outreach center in Dedham, Massachusetts. The new help center will serve customers in the Boston area and surrounding region. These at-risk borrowers will be able to schedule face-to-face meetings with Bank of America homeownership retention specialists who will help determine customers' eligibility for the federal government's Making Home Affordable program or other Bank of America modification or foreclosure avoidance programs.

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FDIC Sells Pool of AmTrust Nonperformers for 37 Cents on the Dollar

A three-party consortium of opportunists has purchased a stake in an $898 million pool of nonperforming residential loans that the FDIC seized from AmTrust Bank last December. The procurers -- which include mortgage servicer Residential Credit Solutions, hedge fund CarVal Investors, and the Royal Bank of Scotland's RBS Financial Products subsidiary -- picked up the AmTrust portfolio with a winning bid amounting to 37 cents on the dollar. Ninety-six percent of the loans are delinquent.

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RE/MAX Says Housing Market Continues to ‘Hold Its Own’

It's evident that the homebuyer tax credit gave a much-needed boost to the housing market. What's unclear is how much of this heightened volume will be sustained. Due to the extension of the closing deadline for this ever-popular government incentive, only time will tell the answer to this question. Regardless, the housing market continued to ""hold its own"" in June, as both home sales and prices increased over year-ago levels, RE/MAX recently reported.

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Regulators Close the Doors on Six More Community Banks

This weekend, six community banks - including three in Florida, two in South Carolina, and one in Michigan - were forced to shut down by their state and federal regulators. This latest round of closings brings the number of FDIC-insured bank failures for the year to 96. Last year at this time, the year-to-date tally stood at 56.

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AllRegs Taps Coester to Create Educational Materials for Lenders

Coester Appraisal Group recently announced that its CEO Brian Coester has been commissioned by AllRegs to develop instruction manuals, video tutorials, and classroom training programs to educate lenders on how to protect themselves against repurchase requests that are based on erroneous assessments of the loan file's appraisal. According to Coester, discrepancies in appraisals account for roughly 15 percent of all repurchase requests, but often the loan originator is not responsible for the discrepancy.

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