Post by unlawflcombatnt on Feb 12, 2007 4:20:51 GMT -6
Below are a number of many articles from a sight called National Mortgage News
"Dodd to Regulators: Tighten B&C Underwriting
Senate Banking Committee Chairman Christopher J. Dodd, D-Conn., says federal banking regulators need to "step up" and tighten the underwriting of certain subprime mortgage products that he contends are responsible for rising defaults and foreclosures. The committee chairman also said he is "annoyed" that the regulators have not responded to his December letter regarding subprime 2/28 adjustable-rate mortgages. In the letter, six members of the committee, including Sen. Dodd, urged the regulators to extend the protections of the nontraditional mortgage guidance to borrowers of 2/28 ARMs, who are disproportionately black and Hispanic. "It is unacceptable to me that they have gone this long without responding to the letter," Sen. Dodd told reporters after a hearing on subprime lending and foreclosures. Mortgage industry representatives presented evidence that there is nothing unusual about the recent rise in foreclosures. But Sen. Dodd maintains that certain subprime practices and loan products are causing the problem. "This is a problem that you cannot attribute to the kind of shocks that normally cause a spike in foreclosures rates," he said. The banking committee chairman is planning to call the regulators to testify before the committee in a few weeks.
Fed Finds Tightened Bank Underwriting
A recent Federal Reserve Board survey found that 15% of banks have tightened their residential underwriting standards in the past three months -- "the highest net fraction posted since the early 1990s," the Fed said. The tightening could be a response to the nontraditional mortgage guidance issued by federal and state banking regulators last fall that set out new underwriting standards for interest-only and payment-option mortgages. It also could be a response to rising delinquencies and defaults. The survey of senior loan officers found that nearly half the banks see the credit quality of their traditional and nontraditional mortgages deteriorating "somewhat" this year. A few large banks expect to see a substantial deterioration in their nontraditional mortgage portfolios during 2007, according to the January survey. In the commercial real estate sector, 35% of domestic banks said they have tightened their underwriting standards -- a "somewhat smaller" percentage than in the October survey. The banks also reported "weaker" demand for CRE loans, the Fed said. The Fed can be found online at www.federalreserve.gov.
Activists Rap GSEs for Buying Subprime MBS
Consumer and civil rights activists are taking Fannie Mae and Freddie Mac to task for their purchases of subprime mortgage-backed securities and "profiting" from abusive lending practices. The two government-sponsored enterprises have lending guidelines so they don't purchase predatory loans directly from lenders, the Rev. Jesse Jackson testified Feb. 7 before the Senate Banking Committee. However, the president and founder of the Rainbow PUSH Coalition said Fannie purchases subprime securities that are "stripping working-class people of their precious home equity.... In short, Fannie Mae and other GSEs are doing through the back door what the law prohibits through the front door. This must change." Center for Responsible Lending chief executive Martin Eakes maintained that Fannie and Freddie are "supporting and condoning lenders who market abusive, high-risk loans" through their investments in the senior tranches of subprime MBS. The GSEs should not get credit toward their affordable housing goals by "investing in loans that generate massive foreclosures," Mr. Eakes said in his testimony. The two GSEs purchased about 25% of the total subprime MBS sold in the first nine months of 2006, according to the CRL. "
More articles are available at the site.
"Dodd to Regulators: Tighten B&C Underwriting
Senate Banking Committee Chairman Christopher J. Dodd, D-Conn., says federal banking regulators need to "step up" and tighten the underwriting of certain subprime mortgage products that he contends are responsible for rising defaults and foreclosures. The committee chairman also said he is "annoyed" that the regulators have not responded to his December letter regarding subprime 2/28 adjustable-rate mortgages. In the letter, six members of the committee, including Sen. Dodd, urged the regulators to extend the protections of the nontraditional mortgage guidance to borrowers of 2/28 ARMs, who are disproportionately black and Hispanic. "It is unacceptable to me that they have gone this long without responding to the letter," Sen. Dodd told reporters after a hearing on subprime lending and foreclosures. Mortgage industry representatives presented evidence that there is nothing unusual about the recent rise in foreclosures. But Sen. Dodd maintains that certain subprime practices and loan products are causing the problem. "This is a problem that you cannot attribute to the kind of shocks that normally cause a spike in foreclosures rates," he said. The banking committee chairman is planning to call the regulators to testify before the committee in a few weeks.
Fed Finds Tightened Bank Underwriting
A recent Federal Reserve Board survey found that 15% of banks have tightened their residential underwriting standards in the past three months -- "the highest net fraction posted since the early 1990s," the Fed said. The tightening could be a response to the nontraditional mortgage guidance issued by federal and state banking regulators last fall that set out new underwriting standards for interest-only and payment-option mortgages. It also could be a response to rising delinquencies and defaults. The survey of senior loan officers found that nearly half the banks see the credit quality of their traditional and nontraditional mortgages deteriorating "somewhat" this year. A few large banks expect to see a substantial deterioration in their nontraditional mortgage portfolios during 2007, according to the January survey. In the commercial real estate sector, 35% of domestic banks said they have tightened their underwriting standards -- a "somewhat smaller" percentage than in the October survey. The banks also reported "weaker" demand for CRE loans, the Fed said. The Fed can be found online at www.federalreserve.gov.
Activists Rap GSEs for Buying Subprime MBS
Consumer and civil rights activists are taking Fannie Mae and Freddie Mac to task for their purchases of subprime mortgage-backed securities and "profiting" from abusive lending practices. The two government-sponsored enterprises have lending guidelines so they don't purchase predatory loans directly from lenders, the Rev. Jesse Jackson testified Feb. 7 before the Senate Banking Committee. However, the president and founder of the Rainbow PUSH Coalition said Fannie purchases subprime securities that are "stripping working-class people of their precious home equity.... In short, Fannie Mae and other GSEs are doing through the back door what the law prohibits through the front door. This must change." Center for Responsible Lending chief executive Martin Eakes maintained that Fannie and Freddie are "supporting and condoning lenders who market abusive, high-risk loans" through their investments in the senior tranches of subprime MBS. The GSEs should not get credit toward their affordable housing goals by "investing in loans that generate massive foreclosures," Mr. Eakes said in his testimony. The two GSEs purchased about 25% of the total subprime MBS sold in the first nine months of 2006, according to the CRL. "
More articles are available at the site.