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Tag Archives: Federal Reserve

Fed’s Duke Addresses Concerns for Borrowers with Low Credit Scores

While originations are down across the board, ""[t]he drop in originations has been most pronounced among borrowers with lower credit scores,"" said Federal Reserves Governor Elizabeth A. Duke. From 2007 to 2012, purchase originations among borrowers with credit scores higher than 780 declined by 30 percent. In contrast, purchase originations for borrowers with credit scores between 620 and 680 declined by 90 percent, and originations among borrowers with credit scores below 620 were ""virtually nonexistent,"" according to Duke.

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Fed: 96K Foreclosure Review Checks to Be Sent to Underpaid Borrowers

About 96,000 borrowers who received a check under the foreclosure review settlement should expect a second payment since their checks were for a lesser amount than what they should have received. The second round of payments to make up for the difference is only for eligible borrowers who had their mortgage serviced by former subsidiaries of Goldman Sachs and Morgan Stanley. Rust Consulting, the paying agent, announced the supplemental checks are scheduled to be sent around May 17. In a release, Rust Consulting said ""a clerical error"" led to the lesser amount.

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Experts See Risk of a Housing Bubble Resulting from Fed Policies

A majority of real estate experts responding to a recent Zillow survey expressed some concern that the Federal Reserve's current policies could lead to another housing bubble. Only 4 percent of respondents are not at all worried about a bubble resulting from the Fed's monetary policy that is keeping mortgage rates down. However, 48 percent see the Fed's policies as ""a little risky,"" and the remaining 48 percent categorized the risk as ""moderate to high risk."" Experts also expect prices to end this year 5.4 percent higher than their level at the start of the year.

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Mortgage Credit Eases as Demand Increases in Q2

The percentage of banks reporting stronger demand for mortgage loans rose in the second quarter, the Federal Reserve reported Monday, with more banks easing lending standards. Those results, revealed in the Fed's Senior Loan Officers Opinion Survey, are consistent with reports that mortgage loans are becoming easier to obtain. While the results suggest a trend in lending standards, they could be misleading: A bank which has tightened standards as much as possible may not necessarily ease them.

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Fourth Round of Foreclosure Review Checks Sent, Bringing Total to 3.9M

The Office of the Comptroller of the Currency (OCC) announced the fourth round of checks from the foreclosure review settlement was sent Friday, May 3. The most recent batch includes 233,404 checks totaling more than $224 million, which brings the overall total to 3.9 million checks valued at $3.4 billion. As of May 2, more than 1.8 million recipients have cashed or deposited nearly $1.7 billion in checks from the foreclosure agreement reached in January between federal regulators and 13 servicers.

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First-Time Jobless Claims Drop to 5-Year Low

First-time claims for unemployment insurance for the week ending April 27 dropped 18,000 to 324,000, the lowest level in more than five years, the Labor Department reported Thursday. Economists expected claims to increase to 354,000 initial claims. Initial jobless claims for the week ending April 20 were revised up to 344,000 from the originally reported 342,000.

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FOMC Raps Obama, Congress as It Continues MBS Purchase Program

With a swipe at both the President and Congress and concerns about ""downside risks"" to the economy, the Federal Open Market Committee (FOMC) voted 11-1 Wednesday to leave interest rates unchanged and to continue its program of purchasing agency mortgage backed securities and longer term Treasury securities. The FOMC explained the actions should ""maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative."" Kansas City Fed President Esther George, cast the lone negative vote.

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More than 220K Foreclosure Review Checks Scheduled for May 3

The checks for Goldman Sachs and Morgan Stanley borrowers covered under the foreclosure review settlement should be mailed out Friday, May 3, the Federal Reserve announced Monday. The next batch of payments will go out to more than 220,000 borrowers who had a mortgage in any stage of the foreclosure process in 2009 and 2010 that was serviced by one of the former subsidiaries, Litton Loan Servicing LP or Saxon Mortgage Services, Inc. The checks for the borrowers are valued at $247 million.

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Q1 GDP Shows Sharp Gain Over Previous Quarter

The nation's economy rose at a seasonally adjusted annual rate of 2.5 percent in the first quarter, slightly slower than economists had expected but more than six times the growth rate in the fourth quarter, the Bureau of Economic Analysis reported Friday. Economists surveyed by Bloomberg had expected gross domestic product (GDP) to grow at a 3.1 percent pace. Residential fixed investment added $11.8 billion to GDP, down from the $15.3 billion contribution in the fourth quarter, and spending on non-residential structures actually subtracted from GDP, albeit a scant $200 million.

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OCC Announces Send Off for 2nd Batch of Foreclosure Review Checks

The Office of the Comptroller of the Currency (OCC) announced the second wave of payments resulting from the foreclosure settlement with federal regulators and 13 servicers was sent Friday. The most recent batch of relief payments includes 1.4 million checks totaling $1.2 billion. So far, 2.8 million checks totaling $2.4 billion have been sent.

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