Tag Archives: Dodd-Frank Reform Act

One year after the passage of the Dodd-Frank Act, Rep. Barney Frank, D-Massachusetts, speaks out with criticism for Republicans and industry participants who oppose the law or wish to change it. Frank's criticisms for Republicans include disapproval of their attempts to alter the proposed Consumer Financial Protection Bureau. Maintaining that risk retention is the most important part of the bill, Frank also censured industry members who oppose the proposed qualified residential mortgage (QRM) definition.

Tight credit conditions for first-time buyers and a foreclosure pipeline full of homes bought with subprime loans mean that house prices at the low end of the market will continue to fall at a faster rate than prices at the middle and high end, according to Capital Economics. The bulk of these low-end homes consists of distressed properties, which already carry steep discounts as lenders and investors try to capture a piece of the limited demand out there to get these homes off their books and back into the hands of responsible homeowners.

The debate over what constitutes a Qualified Residential Mortgage (QRM) is heating up, with a pivotal argument centered around whether or not the proposed QRM stipulations will actually lower the risk of default. In one corner you have the handful of regulators charged with putting the definition of QRM into the rule book, and in the other corner you have just about everybody else, with consumer advocates joining mortgage bankers in a rare showing, and congressional lawmakers standing firmly alongside them.

Unemployment has pushed many homeowners to the brink of foreclosure. Housing analysts have become especially vocal about the effect of extended periods of joblessness on mortgage performance. The average duration of unemployment was 40 weeks in May. On Monday, HUD and NeighborWorks announced the roll-out of the Emergency Homeowners' Loan Program (EHLP) to 27 states and Puerto Rico, extending over $800 million to assist homeowners at risk of foreclosure because of a reduction in income.

Ongoing deterioration in real estate markets and rising levels of distressed residential and commercial properties are areas of acute concern for officials at the Federal Reserve, as banks' performance and capital continue to be adversely affected. Renewed concerns have surfaced about the health of the mortgage market and home equity loans in particular, while high vacancy rates and declining rents still plague the commercial sector. The Fed says it will take time to make progress on the overhang of distress, and banks should expect continuing losses.

Indiana has enacted a new foreclosure law surrounding the state's pre-judgment mediation program, outlining changes related to borrower notification and loss mitigation documentation. Senate Bill 582 passed both chambers of the state Legislature by a near unanimous vote, with only one senator casting a nay, and was quickly signed into law by Gov. Mitch Daniels. The law becomes effective for all new residential foreclosure filings as of July 1.

The FDIC confirmed Monday that Sheila Bair will step down from her post as chairman of the federal agency, effective July 8. Chairman Bair had previously announced her intention to depart the agency following the expiration of her term. No replacement has yet been named.

RxOffice, a default management technology platform from IndiSoft, was recently enhanced to meet the updated Home Affordable Foreclosure Alternatives (HAFA) eligibility rules and forms, such as the Dodd-Frank affidavit. Specifically, the RxOffice short sale module supports the capture of data needed to execute either a HAFA or traditional short sale.

The American Securitization Forum (ASF) is opening a Washington, D.C. office. The organization is headquartered in New York but with all the new rules and regulatory changes coming down from Washington, ASF says a physical presence there will help further its advocacy efforts on behalf of the securitization markets. In conjunction with the office opening, ASF has named Jim Johnson managing director of public policy. Johnson previously served as senior counsel to the U.S. Senate Banking Committee for Ranking Member Richard Shelby.

The U.S. House of Representatives voted to pull the plug on HUD's Emergency Homeowner Loan Program last month, but that hasn't stopped HUD from moving ahead to put the money into the hands of distressed homeowners. The fund was established to provide zero-interest bridge loans of up to $50,000 for unemployed homeowners to continue making their mortgage payments while they look for a new job. HUD just deployed nearly $200 million of the $1 billion allotted to state agencies.