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Senate Adds Mortgage Standards to Reform
American Banker (05/13/10) P. 1; Kaper, Stacy
The Senate voted May 12 for an amendment to financial regulatory reform that would ban yield-spread premiums and force mortgage firms to verify a borrower's income and ability to repay a loan for five years. However, lawmakers appear willing to scale back language requiring securitizers to keep 5 percent of a loan's credit risk on their books. A proposal from Sens. Mary Landrieu, D-La., Kay Hagan, D-N.C., and Johnny Isakson, R-Ga., seeks to exempt certain soundly underwritten mortgages from the risk-retention rules.
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Buyout Firms Compete for US Commercial Real Estate Loans Firm
Property Week (05/13/10) Doyle, David
Apollo Global Management LP is vying with rival buyout firm Centerbridge Capital Partners for CW Financial Services, parent company of the second-largest manager of delinquent U.S. commercial property loans. Also considering a bid is Berkadia Commercial Mortgage. Real Capital Analytics analyst Ben Thypin says the new owner would be "in the driver's seat on a lot of troubled loans."
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Mortgage Applications Rise 3.9 Percent
Investors Business Daily (05/13/10) P. A2
The decline in interest rates to below 5 percent helped increase the number of applications to refinance home loans by 14.8 percent last week, according to the Mortgage Bankers Association. However, total mortgage demand rose only 3.9 percent, as applications to purchase homes fell 9.5 percent in first week following expiration of the home buyer tax credit.
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Foreclosures Down 2 Percent From Last Year
Boston Herald (05/13/10)
The number of households facing foreclosure fell on an annual basis for the first time in five years, reports RealtyTrac, which documented a 2 percent drop in April from a year ago. The foreclosure listing firm also estimated that 334,000 households received a foreclosure-related notice last month, down more than 9 percent from March. Still, banks took back a record 92,000 homes in March; and mortgage data research firm Lender Processing Services said that about 7.4 million borrowers had missed at least one monthly payment or were in foreclosure as of March.
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Prosecutors Ask If 8 Banks Duped Ratings Agencies
New York Times (05/13/10) P. A1; Story, Louise
New York Attorney General Andrew Cuomo has launched a probe of eight banks to determine if they provided misleading data to rating agencies in order to inflate the grades of certain mortgage securities. The inquiry suggests that Cuomo believes the agencies may have been tricked by one or more of the banks in question into raising the ratings on the securities, which ultimately lost money.
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