The Board of Governors of the Federal Reserve System has announced the release of its “Compliance Guide to Small Entities” regarding Regulation Z: Loan Originator Compensation and Steering. The Compliance Guide summarizes and explains rules adopted by the Board, but is not a substitute for the final rule itself, which will be enforced come April 1, 2011. Regulation Z; Docket No. R-1366, Truth-in-Lending was originally published in the Federal Register on Sept. 24, 2010, and as mandated by the Small Business Regulatory Enforcement Fairness Act (SBREFA) Section 212(a) (3), an agency is required to publish a compliance guide on the same date as the date of publication of the final rule (in this case, Sept. 24, 2010), or as soon as possible after that date and no later than the date on which the requirements of the rule become effective (April 1, 2011).
The rule prohibits a loan originator from steering a consumer to enter into a loan that provides the loan originator with greater compensation, as compared to other transactions the loan originator offered or could have offered to the consumer, unless the loan is in the consumer’s interest.
The “Compliance Guide” states that “the regulation applies to all persons who originate loans, including mortgage brokers and their employees, as well as (as defined by the Federal Reserve) mortgage loan officers employed by depository institutions and other lenders. The rule does not apply to payments received by a creditor when selling the loan to a secondary market investor. When a mortgage brokerage firm originates a loan, it is not exempt under the final rule unless it is also a creditor that funds the loan from its own resources, such as its own line of credit.”
According to the Compliance Guide: “To be within the safe harbor, the loan originator must obtain loan options from a significant number of the creditors with which the originator regularly does business. The loan originator can present fewer than three loans and satisfy the safe harbor, if the loan(s) presented to the consumer otherwise meet the criteria in the rule.”
“The National Association of Mortgage Brokers (NAMB) believes that this does not satisfy the requirement as written,” said NAMB Government Affairs Committee Chair Michael Anderson, CRMS. “NAMB is reviewing the Compliance Guide and will taking appropriate action.”
Click here to view “Compliance Guide to Small Entities” regarding Regulation Z: Loan Originator Compensation and Steering.
It is that time of year again. Now that the ball has dropped on 2011, it’s time to celebrate the beginning of tax season. In order to help get you organized and prepared for the grueling task of filing your taxes, here are some tax deductions that are often overlooked. By taking advantage of them, you have the potential to save hundreds or thousands of dollars.
1. Sales and Income Tax Many filers forget to include state sales and income tax as deductions. If you live in a state that doesn’t impose an income tax, adding up all the tax you’ve paid on personal and household items can really mount up. On the other hand, if your state does have an income tax, it’s usually a better strategy to claim that as a deduction for more savings unless you made some high-ticket purchases such as a car or boat.
2. Dividends If your investments have earned you a return this year, you can save money if you take advantage of special tax breaks. If you reinvest your dividends to purchase more shares rather than taking the income they’ve generated, you’ve reduced your current tax liability. This is one deduction a lot of investors miss.
3. Demutualization If your insurance company switched its status from being a mutual insurer and began offering stock to stockholders, this process of demutualization will save you money if you sold your shares based on what the share were worth when they were distributed to you as a former policyholder.
4. Charitable DonationsOut-of-pocket charitable contributions are often overlooked, especially if they were in the form of many small donations rather than a few large ones. If you’ve covered the cost of postage, baked cookies for fundraisers or given rides to the clients of nonprofit organizations, save your receipts. If they total more than $250, you can deduct the amount if you have documentation from your favorite nonprofit. If you provided rides or did other significant driving, claim 14 cents per mile for this deduction.
5. Childcare If you’re a working parent and your kids spend part of the day with a sitter or in child care, claim those expenses as a tax credit. If you have childcare reimbursement through your place of work, you can easily overlook the additional costs you incur beyond the $5,000 or $6,000 allocated by these accounts. Don’t miss out on significant savings; save the receipts for sitters and after-school care. If your children are older and in college, don’t forget to deduct the interest you’ve paid on their student loans throughout the year.
6. Job Search Job losses and career changes aren’t all bad. If you were looking for a job in your previous field; had business cards printed; mailed out resumes; drove to an interview; paid for meals, lodging, and parking for an overnight trip or paid for advertising or employment agency fees, you can deduct those costs up to 2 percent of your adjusted gross income.
If you are a first-time job seeker, you can’t claim those deductions, but you can claim your moving expenses if the new job is more than 50 miles from your old place of residence. You can claim the costs of moving your belongings to the new site, plus 16.5 cents for driving your vehicle there as well as parking and toll fees.
7. Mortgage Interest and Remodeling If you’re a homeowner, you’re luck continues. If you remodeled your existing home, deduct state sales tax for building materials if you’re itemizing. If you bought your house, be sure to claim the interest paid on the points on your mortgage. If you’ve refinanced, you have to distribute the points interest over the life of the mortgage. If you’ve made your home more energy-efficient, you can get a 30 percent credit of the purchase price, up to $1,500.
8. Military Travel If you are a member of the National Guard or are a military reservist, part of your travel expenses for attending meetings or drills more than 100 miles from home and overnight stay are deductible even if you don’t itemize. You can write off all your lodging cost and half your meal expenses, as well as mileage and tolls if you drove your own vehicle. Mileage is reimbursed at 50 cents per mile.
9. Self-Employment With widespread job loss, many Americans have switched to self-employment. This freedom comes at a price. These workers not only have to buy their own health insurance, they also pay a hefty self-employment tax. Make sure to deduct the cost of health insurance premiums you pay for yourself and your family. This reduces your self-employment tax. You’re going to have to dig a bit through Schedule SE. Your health insurance figure from Line 29 is subtracted from your calculated self-employment tax on Line 3.
What other commonly overlooked tax deductions can you think of?
This article was written by Bob who runs ChristianPF.com, a personal finance blog tackling the topic using Biblical principles.
The drumbeat from the housing community was loud and clear in 2010: There was never a better time to buy a home.
For most of the past 12 months, home prices tumbled, mortgage rates ticked downward, and the inventory of available traditional and distressed homes was plentiful.
But would-be buyers, even if they were able to overcome job worries, found that the hurdles to obtain a loan were formidable. They remained on the sidelines, and housing analysts opined that if the broader economy improved and unemployment fell, pent-up demand would be unleashed, credit guidelines would ease and home sales would improve.
As the new year begins, that guarded optimism has turned into uncertainty, thanks to a combination of rising mortgage rates, tighter underwriting guidelines and sweeping government regulation. As a result, it’s unlikely to get any easier and may, in fact, get much more difficult to buy a home in 2011.
“From a credit standpoint, I tend to think we’re toward the bottom of that cycle,” said Bob Walters, chief economist for Quicken Loans Inc. “The bad news is, I don’t think it’s going to get a lot better in 2011. You’ll hear a lot more noise pressuring the industry to ease guidelines, and you’ll hear from the industry that we don’t want a redo of what’s happened.”
Looming large over the mortgage market are provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act that have yet to be finalized. Among them is a requirement that mortgage lenders maintain some “skin” in the game on the mortgages they originate by holding at least 5 percent of the credit risk rather than bundling the loans and selling them off entirely.
The goal is to discourage a repeat of risky past practices, but the legislation makes an exception to the risk-retention standard for what is labeled a “qualified residential mortgage.” It is the still-unspecified definition of what’s become the industry’s latest acronym to digest, QRM, that has lenders in an uproar.
If a very strict definition is applied by regulators, and a final rule isn’t expected until the spring, it could become more difficult, and more costly, for homebuyers to secure mortgage financing.
“People have some very different ideas of how to define this,” said Michael Fratantoni, vice president of research and economics at the Mortgage Bankers Association. “Some would say if it doesn’t have a 30 percent down payment, it’s not a QRM. For a first-time homebuyer, that would really be eye-opening. It definitely has the potential to turn the market upside down.
“This could dramatically tighten underwriting much more than what the lenders have already done. It’s going to make it even tougher to work through the (housing) overhang.”
Wells Fargo has told regulators it supports exempting mortgages with a 30 percent down payment. Community banks worry such a strict definition would curtail home mortgage lending.
“If you have to have 30 percent down, the American dream would become the American fantasy,” said Nick Parisi, a senior vice president at Standard Bank and Trust Co. in Hickory Hills, Ill.
Less competition
Additional regulation on mortgage bankers will mean a thinning of their ranks, weeding out the unscrupulous players. But it also will lessen consumers’ ability to comparison-shop widely for the best home mortgage product.
“That means less competition, and generally, less competition is not good for the consumer,” said Quicken’s Walters. “It might mean that your interest rate over time is a little higher. A less competitive industry has to work less hard.”
Tighter lending requirements already have steered 40 percent of buyers to secure Federal Housing Administration-backed loans, which carry their own set of fees. FHA-backed loans are exempt from the Dodd-Frank provision.
Another new wrinkle to the mortgage market is that beginning in March, Freddie Mac will raise fees for mortgages sold to Freddie that carry higher loan-to-value ratios.
Fannie Mae in late December announced its own series of considerable loan-level price adjustments, effective April 1, for mortgages with greater than a 60 percent loan-to-value that will apply even to consumers with credit scores above 700.
Loan fees aren’t the only item going up: So is the cost of money itself. The average rate on 30-year, fixed-rate mortgages has been below 5 percent since early May, but economists predict those days are nearing an end.
General guidance on mortgage rates for a 30-year, fixed-rate mortgage call for them to stay under 6 percent for the year, likely falling somewhere between 4.75 percent and 5.5 percent. Still, that could be a jolt to buyers on the sidelines who watched rates drop to as low as 4.2 percent in the fall.
New Listings on OregonLandSalesContract in both the Real Estate listings and buyer listings sections. OregonLandSalesContract is a web site dedicated to marketing real estate in which the seller is offering terms and buyers that are looking for seller financing opportunities.
Well, as you may have suspected, the San Francisco-based bank and mortgage lender was also tops with respect to total number of loans closed.
During the third quarter, the company closed 469,914 home loans, up five percent from the 446,403 loans closed a year earlier.
In the second quarter, the bank closed less than 400,000 loans, but closed a staggering 581,961 in the second quarter of 2009, when the refinance boom got its legs, thanks to those record low mortgage rates.
That, along with the reduced staff, may explain why it took so long to get an underwritingdecision on your loan.
Gone are the days of same-day or 24-hour underwriting – now it’s a couple of weeks, if you’re lucky.
Of course, loan origination volume is expected to slow this year, so maybe it’ll be easier to get that decision from the bank a little quicker.
Check out the rest of the leaders in total residential home loans closed, along with their market share and year-over-year change.
Quicken Loans was the biggest gainer (+65%), while Bank of America saw a more than 25 percent decline, but still held on to the second spot.
With the new, recently announced changes to FHA Loan Requirements, homeowners are expected to overwhelm FHALenders, in the new year, hoping to see if they qualify for the new program. As a government home loans program designed specifically to give renewed hope to those residing in “underwater” properties, homeowners are rallying to see if they qualify. Both the Making Home Affordable program and the FHA’s refinancing programs will be nuanced to allow FHA lenders to provide FHA mortgage loans that will potentially forgive at least 10% of the existing mortgage’s principal balance. These newly generated FHA Loan Requirements are creating quite a buzz amongst homeowners worried they could lose their homes down the road. It’s critical to understand that these mortgages are for property owners currently paying down a subprime or conventional mortgage loan. The property must have a current valuation that’s lower than the property owners current loan(s). Approved applicants must owe a minimum of 15% more on the residence than its current market value. You may wish to get out your loan calculator and see where you stand. These new FHA mortgage programs provide aid to those who qualify with a potential 10% reduction on their home loan(s). But, these programs are only available to those who are still current on their home payments. Given the thousands of homeowners who were advised to become delinquent so that they would be considered for a loan modification by their lender, the pool of candidates who might make the cut is the big question. In addition to these stringent qualification requirements, the borrower must currently show a credit score of at least 500 and the property must be the homeowner’s primary residence. Yet, another potential obstacle is that these FHA Mortgages featuring these FHA Loan Requirements are to be offered to those not already holding an FHA loan. Again, only those with non FHA subprime or conventional mortgages will be seriously considered as applicants. The program is being offered for a limited time only and ends December 31st, 2012. How Homeowners with FHA Loans Must Be Proactive If They Believe They Might Default. Preventing Foreclosure or Short Sale Requires Immediate Interaction With FHA Counselors. Know that once you acquire an FHA mortgage, that the rules regarding homeowners who have defaulted are much stricter than a non-FHA home loan. Once you’ve missed a payment on an FHA mortgage, given the FHA’s Loan Requirements, it’s critical to initiate contact with your lender immediately. Once certain deadlines are missed, there is nothing either your lender or the FHA can do to stop you losing your home to foreclosure. The rules regarding loan forbearance are completely different for FHA mortgage holders. As soon you become even one day late on your mortgage, this time line kicks in. The FHA has laid out very specific steps that are important for the homeowner, to initiate, to successfully stop foreclosure. As mentioned, you should immediately contact your lender. It’s also a critical to contact the nearest FHA/HUD counselor. Negotiating your situation within the FHA’s default regulations could help give you a better shot at keeping your home, in spite of the late of missed mortgage payments. Taking action is the most important thing a homeowner who has fallen behind, can do. Thousands of homeowners have thrown up their hands and resorted to wishing. But, problems will simply not resolve themselves on their own. This can result in a disastrous result. The minute you know you’ve got a problem, contact your FHA counselor and your lender. Being aggressive has never meant more. An FHA mortgage holder who has missed the first payment wait. Contacting an FHA housing counselor can definitely help prevent the situation from worsening. FHA/HUD housing counselors can be sourced using the HUD Government Website. Once an FHA home mortgage loan holder has missed four or more payments, the clock may have run out regarding their ability to work out a foreclosure avoidance strategy with their lender, regardless of having an FHA/HUD counselor’s assistance. If nothing has been negotiated by the time the 4th mortgage payment is late or unpaid (Or, if the homeowner has been sent a Demand Letter, that deadline has already passed,) the property is assigned to the lender’s legal department and the foreclosure process is initiated. Many homeowners are fairly confused about the rules regarding repossession laws and repo houses, given the rapid changes in the laws over the last few years. Furthermore, the homeowner is responsible for all the fees related to the delinquency and foreclosure process and may find bankruptcy to be their only remaining source of debt relief. As many property owners have found, the process, regardless of foreclosure moratoriums or investigations by government officials, often ends up with their home sold at auction. Some are fortunate to receive a cash for homes or “Cash For Keys” offer from their lenders. (Another incentivized government program.) Others merely find themselves escorted from their homes by U.S. Marshalls, willing to use deadly force to insure their removal. Norma J. Wheeler is a realty, foreclosure and short sale specialist who writes about programs designed to help struggling homeowners. She is a contributing editor at http://savemyhousenow.net/ as well as an avid blogger. Check out her recent article regarding FHA Loan Requirements for struggling homeowners at: http://www.scribd.com/doc/456534/Fha-Loan-Requirements-New-Loan-Requirements-Fha
Mortgage applications in the U.S. rose last week from a 12-month low as refinancing increased for the first time since early November.
The Mortgage Bankers Association’s index of loan applications increased 2.3 percent after dropping 3.9 percent in the prior week to the lowest level since December 2009. The group’s refinancing gauge rose from the lowest level since Jan. 1, while the purchase index declined.
Home-purchase applications fell 31 percent at the end of the year from a 2010 high in April, while an increase in mortgage rates hampers refinancing. Declining home prices, mounting foreclosures and unemployment hovering near 10 percent mean any recovery in housing, the industry that triggered the recession, will probably take years.
“It doesn’t look good,” Brian Bethune, chief financial economist at IHS Global Insight in Lexington, Massachusetts, said before the report. “With rates moving up, it’s going to be a tough hurdle.” On purchases, “we’re still in this sideways, choppy situation.”
The group’s refinancing gauge rose 3.9 percent after dropping 7.2 percent. The purchase index fell 0.8 percent last week after rising 3.1 percent.
The average rate on a 30-year fixed loan dropped to 4.82 percent last week from 4.93 percent the prior week, which was the highest since May, the group said. The rate reached 4.21 percent in October, the lowest since the group’s records began in 1990.
Borrowing Costs
At the current 30-year rate, monthly borrowing costs for each $100,000 of a loan would be $525.87, or about $22 less than the same week the prior year.
The share of applicants seeking to refinance a loan rose to 71 percent last week from 70.3 percent the prior week.
Hovnanian Enterprises Inc., the largest homebuilder in New Jersey, on Dec. 22 reported a fourth-quarter loss bigger than analysts expected as revenue fell 19 percent.
“The year can generally be described as one where we and the industry were bouncing along the bottom,” Chief Executive Officer Ara Hovnanian said on a conference call.
The Washington-based Mortgage Bankers Association’s loan survey, compiled every week, covers about half of all U.S. retail residential mortgage originations.
In these cases, where federal or proprietary home loan modifications are unavailable or unhelpful, unemployed homeowners may be able to participate in foreclosure alternatives programs which allow homeowners to surrender or sell their home and essentially be forgiven of their remaining mortgage debt. Short sale options, which have typically been used by homeowners in an underwater mortgage situation, and deed in lieu of foreclosure plans may be available to homeowners who have shown a previous ability to make the mortgage payment but, due to factors like unemployment, are simply unable to continue making home loan payments.
Foreclosure Prevention
The Federal Housing Finance Agency (FHFA) released its Third Quarter 2010 Foreclosure Prevention Refinance Report on the status of loan modifications at both Freddie Mac and Fannie Mae. Loan modifications through the Home Affordable Modification Program (HAMP) reportedly increased 16 percent in the quarter, although the overall volume of loan modifications and the pace of HAMP modifications declined from previous periods.
HAMP
The Home Affordable Modification Program (HAMP) was started in 2009 by the Obama Administration to bring forth a program to bring back financial stability to homeowners all over the country. The program addresses the major housing hardships that have been hurting our country, but like with sponsored programs, it has its flaws. HAMP was supposed to be designed to help lower homeowner’s payments by lowering their interest rate, changing the loan’s terms, and/or extending the length of the loan. However, now a year and a half into the program, we have observed failure much beyond what many expected.
Short Sale Program
Obviously, homeowners may still have to work with their mortgage servicer in some cases, but there or certain programs which offer grant-like assistance options to homeowners, borrowing opportunities for loans at 0% interest which may be forgiven, or even foreclosure alternative programs for homeowners who are simply in a situation where these assistants plans may not be beneficial. While homeowners may still contact their mortgage servicer to inquire about assistance, state housing agencies also have information regarding these state-specific programs which could be beneficial to homeowners in areas that are facing a greater than average number of home loan hardships.
Who says that just because you’re dead you can’t keep on working? In what is certainly the most blatant case of robo-signing I’ve seen to date, one company had a woman signing hundreds of documents- for thirteen years after her death. [Hat tip Freedoms Phoenix.]
How, may you ask, can a woman who has been dead since 1995 sign documents more than a decade later? Normally, one would hazard to guess that stamps with her signature on them were still in use (this is more common than you would think in foreclosure land). That would be plenty troubling.
But this little account comes from the debt collection realm, a cesspool of bad practices. Here, the credit card company Providian (acquired by WaMu in 2005) had employees signing affidavits in the name of Martha Kunkle for over a decade. Debt collection agencies continued to use these bogus affidavits.
According to the Wall St. Journal:
Questions about Martha Kunkle first popped up in 2008 after her name appeared in thousands of affidavits generated by a unit of Providian National Corp. The credit-card issuer sold an undisclosed number of delinquent account balances to Portfolio Recovery Associates and other debt collectors, which then sued the borrowers to collect the debt…..
Concerns about Ms. Kunkle’s affidavits were raised in 2008 by lawyers for Jeanie Cole, one of thousands of Montana residents sued by Portfolio Recovery Associates to collect debts. After failing to locate Ms. Kunkle, lawyers for Ms. Cole interviewed her daughter, who worked at Providian in a document-processing division.
The daughter testified in a deposition that other Providian employees used the name Martha Kunkle when signing affidavits. Along with other employees, the daughter was responsible for signing affidavits. After countersuing Portfolio Recovery Associates for alleged violations of the Fair Debt Collection Practices Act, Ms. Cole was the lead plaintiff in a 2008 federal-court suit in Montana alleging the company targeted 16,000 borrowers using “false and misleading” affidavits.
These dodgy documents were for debt collections, not foreclosures. However, this does show how sloppy and overly automated the lending industry has become.
Some judges say robo-signing, in which affidavits are signed without fully reviewing underlying documentation, is more common in debt-collection cases than foreclosures. In July, the Federal Trade Commission recommended that state regulators require the disclosure of “more information” by debt collectors and buyers, concluding that they might be relying on erroneous or incomplete paperwork when suing to recover money.
“I’ve watched and wanted to tell defendants in these suits to demand proof of the underlying debt because that proof is so often flimsy,” said Jeffrey Lipman, a magistrate judge in Polk County, Iowa, which includes Des Moines, the state’s capital. Court rules give him little leeway to instruct borrowers in court.
Borrowers, beware.
Invesco Institutional acquired the 332-unit tower from U.S. Bank. The bank took over Ladd Tower, 1300 S.W. Park Ave., in August from developer Opus Northwest in lieu of foreclosing on an $82 million construction loan.
Ladd Tower is one of the last local projects completed by Opus Northwest, once one of the region’s most prolific developers with 17 million square feet developed in the metro area.
Also in November, Opus sold its 101-unit Park 19 project, 550 N.W. 19th St., or $28.8 million to TIAA-CREF, a New York investment giant.
The number of contracts to buy previously owned homes rose more than forecast in November, a sign sales are recovering following a post-tax credit plunge.
The index of pending resales increased 3.5 percent after jumping a record 10 percent in October, the National Association of Realtors said today in Washington. The median forecast in a Bloomberg News survey called for a 0.8 percent rise in November, and the gain was the fourth in five months. The group’s data go back to 2001.
Home demand is stabilizing after sales collapsed to a record low in July, as the effects of a tax incentive worth as much as $8,000 waned. A jobless rate hovering near 10 percent means foreclosures will remain elevated and any recovery in housing, the industry that precipitated the worst recession since the 1930s, will take time to develop.
The figures are “in line with an ongoing gradual pickup in existing-home sales in December,” Yelena Shulyatyeva, an economist at BNP Paribas in New York, said in an e-mail to clients. “Housing demand should continue its uneven recovery entering 2011 as housing oversupply should keep pushing housing prices down.”
A report today from the Labor Department showed claims for jobless benefits fell last week to the lowest level since July 2008, showing the labor market is improving heading into 2011. Filings decreased by 34,000 to 388,000 in the week ended Dec. 25, fewer than the lowest estimate of economists surveyed.
Business Barometer
Other figures showed the economy accelerated at the end of the year. The Institute for Supply Management-Chicago Inc.’sbusiness barometer jumped to 68.6 in December from 62.5 in the prior month. Readings greater than 50 signal expansion and the level was the highest since July 1988.
Stocks fluctuated between gains and losses after the reports. The Standard & Poor’s 500 Indexfell 0.1 percent to 1,258.23 at 11:17 a.m. in New York. The benchmark 10-year Treasury note declined, pushing up the yield to 3.39 percent from 3.35 percent late yesterday.
The projected increase in pending home sales was based on the median of 24 forecasts in the Bloomberg survey. Estimates ranged from a drop of 5 percent to a gain of 5 percent.
Two of four regions saw an increase, today’s report showed, led by an 18 percent jump in the West. Pending sales rose 1.8 percent in the Northeast. They fell 4.2 percent in the Midwest and 1.8 percent in the South.
November 2009
Compared with November 2009, pending sales in the U.S. were down 2.4 percent.
Even as the labor market is improving and manufacturing is growing, housing remains a weak link. NAR chief economist Lawrence Yun last week estimated there were about 4.5 million distressed properties that could potentially reach the market in coming months.
Average home prices as measured by the S&P/Case-Shiller indexes have begun dropping again after rising when the tax incentive was in effect. The group’s 20-city index fell 0.8 percent in October from a year earlier, the biggest year-on-year decline since December. It fell 1 percent from the prior month, and is down 30 percent from its July 2006 peak.
Reports earlier this month showed the housing market is stuck near recession levels. Housing permits fell in November to the third-lowest level on record, while starts rose for the first time in three months, the Commerce Department reported Dec. 16.
Sales of new and existing homes last month rose less than projected by the median forecast of economists surveyed by Bloomberg, reports from the Commerce Department and the National Association of Realtors showed last week. Existing home sales represent closings on the contracts captured by the pending sales gauge.
Hovnanian Enterprises Inc., the largest homebuilder in New Jersey, on Dec. 22 reported a fourth-quarter loss bigger than analysts expected as revenue fell 19 percent.
“The year can generally be described as one where we and the industry were bouncing along the bottom,” Chief Executive Officer Ara Hovnanian said on a conference call.
Even so, economists in the past two weeks have boosted projections for fourth-quarter growth, reflecting a pickup in consumer spending and passage of an $858 billion bill extending all Bush-era tax cuts for two years.
The company bested its year-ago total of $97.9 billion and crushed the $83 billion originated in the second quarter, thanks in part to the record low mortgage rates on offer, which sparkedrefinance demand.
Bank of America came in a distant second with $74 billion and 16.66 percent market share – Chase originated about half of that, with $42.7 billion and 9.60 percent market share.
Their volume was nearly identical to the volume seen a quarter earlier, but 25 percent lower than that seen a year ago.
Rounding out the top five were CitiMortgage and Ally Bank/Residential Capital (GMAC) with $20.3 billion and $20.2 billion, respectively.
The pair saw market share of just over nine percent combined.
So the five largest mortgage lenders accounted for nearly 60 percent of all loan origination volume.
Quicken Loans was the biggest gainer in the top 10, with an 88 percent increase seen from the third quarter of 2009.
SunTrust Bank was the biggest loser year-over-year, chalking a 34 percent decline.
Take a look at the top 10 mortgage lenders in the third quarter of 2010:
I have new clients that are looking for a home to lease, lease to own or buy on contract. This is a professional couple that will be moving to the area with in the next 60 to 90 days. They have a dog that is well trained and mannered. It is a 100 pound german shepherd. Homes in which pets are welcomed and either has a dog positive yard or near areas where my clients can walk their dog in safety are a must. Client can provide references for themselves as well as their dog.
If you have a listing you feel my clients might be interested in or you know of one let me know. When you contact me just reference SG12 so I will know which clients you are referring too.
Please feel free to forward this message to anyone you feel might have a property for my clients.
To find out more information about my clients and what they are looking for please visit OregonRealEstateWanted.com and scroll down to buyer SG12 or contact me.
I have new clients that are looking for a home to lease, lease to own or buy on contract. This is a professional couple that will be moving to the area with in the next 60 to 90 days. They have a dog that is well trained and mannered. It is a 100 pound german shepherd. Homes in which pets are welcomed and either has a dog positive yard or near areas where my clients can walk their dog in safety are a must. Client can provide references for themselves as well as their dog.
If you have a listing you feel my clients might be interested in or you know of one let me know. When you contact me just reference SG12 so I will know which clients you are referring too.
Please feel free to forward this message to anyone you feel might have a property for my clients.
To find out more information about my clients and what they are looking for please visit OregonRealEstateWanted.com and scroll down to buyer SG12 or contact me.
The proposal would require servicers to initiate contact with all borrowers who are 60 or more days behind on their mortgage payments and offer them access to the federal modification program. Only after the homeowner has been screened under the HAMP guidelines and it is determined that the loan cannot be saved, could foreclosure proceedings commence. The proposal would also halt any foreclosures already in process once a borrower has been accepted into the trial phase of the program.
The proposal was reviewed by lenders last week on a White House conference call and “prohibits referral to foreclosure until borrower is evaluated and found ineligible for HAMPor reasonable contact efforts have failed,” Bloomberg Newsreported, citing a Treasury Department document outlining the plan.
Some lenders have been voluntarily suspending foreclosure proceedings while they evaluate a homeowner’s eligibility for HAMP, but under the program’s current guidelines there is no requirement to do so, and a number of homeowner advocacy groups have submitted complaints to the administration that even borrowers who are making their trial payments are being hit with foreclosure litigation.
A Treasury spokesperson confirmed that a foreclosure ban is under consideration, but stressed that it is one of many ideas on the table and has not been approved yet.
Laurie Goodman, a senior managing director at the Amherst Securities Group who has been highly critical of the government’s modification program, told the New York Times that even if the proposal came to pass, it would.
not be “a major change. We think there is a large public relations element to this,” she said.
As the Times noted, the government could use some favorable public relations for its modification program. Lawmakers have begun to openly express their disappointment with the program. On Thursday, members of the House Committee on Oversight and Government Reform said matter-of-factly in a report, that by every practical measure, “HAMP has failed.”
Reps. Darrell Issa (R-California) and Jim Jordan (R-Ohio) called the program a misuse of taxpayer money, theWashington Post said. The program has been allocated $75 billion to pay incentives to servicers, investors, and borrowers for loan restructurings, but the paper says that so far only $15 million has been spent.
As of the end of January, 116,297 troubled mortgages had been permanently modified under HAMP. About 830,000 more were in the trial phase of the program. The administration’s goal is to help three to four million borrowers save their homes through the program by the end of 2012.
News of a draft document by the Treasury outlining additional changes to HAMP also circulated this week. Besides the proposed ban on foreclosures until after aHAMP review, the administration is also considering implementing a mandatory 30-day appeal period for borrowers that are denied a federal modification. Servicers would not be allowed to proceed with a foreclosure sale during this time.
The proposal would also require servicers to prove that they have made multiple attempts to contact delinquent borrowers both by phone and via written notices, and would require them to consider HAMP applications from homeowners that have already filed for bankruptcy.
Lenders have expressed concern that the proposed requirements would prolong foreclosure delays beyond the current 12 month timeline that it typically takes to resolve the loans that don’t qualify for a modification.
Earlier this month at the American Securitization Forum’s annual meeting, Seth Wheeler, a senior advisor at the Treasury Department, told mortgage bond investors and lenders that the administration is also considering revising HAMP’s net present value (NPV) model in order to incorporate more principal writedowns into the equation. The NPV test is applied to determine if the mortgage owner can recoup more money by restructuring the loan or by foreclosing.
RISMEDIA, December 27, 2010—Refinancings through the Home Affordable Refinance Program (HARP) increased 26% in the third quarter of 2010. Fannie Mae and Freddie Mac loan modifications through the Home Affordable Modification Program (HAMP) increased 16% in the quarter, although the overall volume of loan modifications and the pace of HAMP modifications declined from previous periods. The data were released in FHFA’s Third Quarter 2010 Foreclosure Prevention & Refinance Report, which includes data on all of the Enterprises’ foreclosure prevention efforts.
Findings of the report include:
-Loans modified in the last three quarters are performing substantially better three months after modification, compared to loans modified in earlier periods.
-More than half of the loan modifications completed in the third quarter lowered borrowers’ monthly payments by over 30%.
-Loans that are 30-days delinquent increased by 17,600 loans or 2.7% during the third quarter to approximately 682,000.
-Loans 60-plus-days delinquent declined for the third consecutive quarter. The 60-plus-days delinquent loans decreased by 109,700 loans, or 6.8% during the third quarter to approximately 1.5 million.
-Nearly 35,400 HAMP trial modifications transitioned to permanent during the third quarter, bringing the total number of active HAMP permanent modifications to nearly 260,000.
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Internal security stepped up after Assange announces plans for ‘megaleak’ about a large bank.
Heading into the new year, a big question looms for Bank of America: What’s next in the WikiLeaks saga?
Julian Assange, the anti-secrecy organization’s founder, has said he is preparing a “megaleak” about a large bank, leading to speculation the Charlotte bank is the target. On Monday, he told the Times of London that he had enough information to make the bosses of a major bank resign.
Meanwhile, Bank of America has cut off payments intended for WikiLeaks, spurring the group to tell customers to stop doing business with the bank. Other financial institutions that have foiled payments have faced cyberspace attacks from WikiLeaks supporters, but so far the bank doesn’t appear to be suffering ill effects.
Analysts say it’s possible WikiLeaks could stir up new trouble for the nation’s biggest bank, perhaps exposing more problems in the mortgage arena or reviving questions about its Merrill Lynch acquisition. It’s also possible the revelations cause little harm or that WikiLeaks bypasses the bank altogether.
Bert Ely, a Virginia-based banking consultant, said he suspects all major financial institutions are girding for the group’s next move.
“We don’t know it’s Bank of America,” he said. “It could be one of a number of banks.”
In recent months, WikiLeaks has gained notoriety for exposing Pentagon and State Department secrets and for Assange’s fight against sexual assault charges in Sweden. In November, he told Forbes magazine that his group planned a bank leak in early 2011. That drew attention to a 2009 article in which Assange said WikiLeaks had obtained a Bank of America executive’s hard drive.
Bank of America has said it has no evidence that WikiLeaks has company data but it has said little else on the subject. In a speech earlier this month, chief marketing officer Anne Finucane hinted Bank of America was steeled for any possible revelations, partly because it already has endured intense investigations of its 2008 Merrill deal.
“We have been out there pretty much 24/7, whether those of us who run communications like it or not, and we have learned not only to react, but deal with this as a given,” Finucane told a Boston audience.
A Bank of America employee told the Observer that it appeared the bank had stepped up security internally recently, taking steps to block access to websites such as Gmail on company laptops. The bank declined to comment on security procedures.
Analysts say they’re watching for the next development, which could cause new problems for a company still trying to recover from the financial crisis. When speculation surfaced on Nov. 30 that Bank of America could be WikiLeaks’ next target, the bank’s shares plunged more than 3 percent to $10.95. But since that drop-off, the bank’s shares have climbed nearly 15 percent to $12.98 at Tuesday’s close.
Jefferson Harralson, a bank analyst with Keefe, Bruyette & Woods, said WikiLeaks’ revelations are unlikely to highlight a new problem but could add more color around topics already in the news. The bank’s mortgage unit, bulked up by the 2008 Countrywide Financial acquisition, has been the biggest trouble spot lately. The most costly issue is requests by investors to buy back billions in soured mortgage loans originated and sold off by Countrywide during the housing bubble.
“The soft underbelly (for Bank of America) would be the mortgage crisis,” Harralson said.
Still, analysts already are braced for huge losses tied to mortgage loan repurchase requests. Harralson estimates the bank could spend $35 billion over five years buying back mortgages, although he suspects the amount could end up being less.
Ely, the banking consultant, said WikiLeaks could reveal information on a range of issues, from executives’ actions during the Merrill Lynch acquisition to who is using the company jet. One of the more damaging disclosures would be evidence of securities law violations, such as the manipulation of earnings or the failure to disclose material information to investors, he said.
“That can trigger lawsuits from shareholders and bring out the class-action bar,” he said.
The New York Times on Tuesday reported that regulators also are worried that WikiLeaks revelations could show failings by the agencies charged with overseeing the banking industry. Earlier this month, however, Federal Deposit Insurance Corp. chairman Sheila Bair downplayed concerns about a leak. “I have a hard time understanding what would be so provocative,” she said after a speech. “So I would just ignore it, I really would.”
On Friday, Bank of America said it cut off payments to WikiLeaks because it had “reasonable belief that WikiLeaks may be engaged in activities that are, among other things, inconsistent with our internal policies for processing payments.” A bank spokesman declined to answer further questions.
Analysts said the bank could have a number of reasons for making the move, including pressure from the government, a desire to separate itself from possible criminal activities or revenge for obtaining its internal information.
Through its Twitter handle, WikiLeaks has encouraged Bank of America customers to close their accounts. The bank’s website doesn’t appear to be suffering from cyberspace attacks. Rich Mogull, analyst and chief executive at security research firm Securosis, said WikiLeaks supporters would need “massive resources” to dent the bank’s formidable defenses.
“Bank of America is always under attack,” Mogull said. “It’s one of the biggest targets on the Internet.”
In case of any leaks, Harralson said Bank of America is likely preparing its legal response, although that could be difficult against an “ephemeral” organization like WikiLeaks. “You can examine your legal options,” he said, “but it’s a hard organization to pin down.”
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Borrowing costs on home loans continue to increase, with mortgage rates rising sharply for the past five weeks in a row. New data released Thursday show that the average rate for a 30-year mortgage jumped 22 basis points over the last seven days. Freddie Mac reports that rates for a 30-year fixed mortgage averaged 4.83 percent (0.7 point) for the week ending December 16, 2010. That’s up from last week’s average of 4.61 percent. Last year at this time, the 30-year rate was 4.94 percent.
The GSE’s weekly rate survey is based on data gathered from about 125 lenders across the country, and it showed increases across the board.
The 15-year fixed-rate mortgage this week averaged 4.17 percent (0.7 point) in Freddie’s study. Last week, it was 3.96 percent, and a year ago at this time, it was 4.38 percent.
Adjustable-rate mortgages (ARMs) also climbed higher. Freddie says the 5-year ARM averaged 3.77 percent (0.7 point) this week, up from 3.60 percent. Rates on 1-year ARMs came in at 3.35 percent (0.7 point), compared to 3.27 percent the previous week.
A separate study released by Bankrate Thursday, which derives its figures from data provided by the top 10 banks and thrifts in the top 10 U.S. markets, shows that 30-year rates among its covered lenders already hit the 5.00 percent (0.4 point) mark this week. That’s up from a 4.89 percent average reported by Bankrate last week.
It’s the first time since May that the 30-year rate has hit the 5 percent threshold in Bankrate’s study. As recently as November 3, mortgage rates were at a record low of 4.42 percent, according to the tracking firm’s analysis.
The average 15-year fixed mortgage increased to 4.37 percent (0.38 point), and the larger jumbo 30-year fixed rate rose to 5.58 percent in Bankrate’s study.
Adjustable rate mortgages were also higher, with the average 5-year ARM jumping to 3.95 percent and the average 7-year ARM climbing to 4.36 percent.
Bankrate surveys a panel of mortgage experts each week to gauge which way they think rates are headed over the next seven days. Nearly three-quarters of the panelists, 73 percent, expect mortgage rates to increase and only 7 percent predict rates to decline. The other 20 percent forecast that rates will remain more or less unchanged over the next week.
OREGON REAL ESTATE ROUND TABLE 