Archive for December, 2010
The probable rate of mortgage fraud on loans written in 2010 increased 20% as the amount of loans originated continues to fall, according to data analytics firm CoreLogic (CLGX: 14.56 +0.62%).
The CoreLogic Fraud Index estimates losses on loans due to fraud will drop to $11 billion in 2010, down 21% from the $14 billion reported in 2009. It’s the lowest amount of losses since 2006 when CoreLogic found nearly $30 billion lost on mortgages written to much more lenient underwriting standards.
But even though losses have dropped by dollar amount, the rate of fraud became more prominent due to higher-risk government loan programs, according to CoreLogic. Actual fraud losses are lower because the origination market is down 26% from a year ago.
Lenders filed more than 35,000 suspicious activity reports on questionable loans during the first half of 2010. That's up 7% from the same period a year before, according to the Financial Crimes Enforcement Network. In December, FinCEN proposed a new requirement forcing nonbank residential mortgage lenders to begin filing the reports.
Write to Jon Prior.
Wells Fargo & Co. agreed to make an estimated $2.4 billion in mortgage modifications for California homeowners with "pick-a-payment" type adjustable-rate loans, as part of an agreement with the state's attorney general.
The Senate passed a bill directing the Government Accountability Office to conduct a comprehensive study of the National Credit Union Administration's handling of the corporate credit union meltdown.
The study would also evaluate the agency's handling of the growing losses among big credit union failures.
Commercial mortgage lender Walker & Dunlop made an inauspicious debut on the New York Stock Exchange last week as its shares closed below the initial-public-offering price, but the showing may say more of the tempering IPO market than the strength of the offering.
The Bethesda firm's stock, with an initial per-share price of $10, hovered around $9.80 for much of the day and closed at $9.90. Shares were priced well below the $14 to $16 range that Walker & Dunlop anticipated in its Securities and Exchange Commission filing on Dec. 13.
Perhaps the most sacred of all the sacred cows in the tax code, the home mortgage deduction has long been seen as critical to a major element in the American dream — owning your own home. It's also a boon to home builders, construction workers, the financial services industry and local governments that benefited from fatter real estate tax revenue.
But after nearly a century, the mortgage deduction may face a day of reckoning. Though out of the spotlight for the moment while the lame-duck Congress thrashes to an end, the mortgage deduction issue is likely to resurface next year when new representatives — including a lot more deficit-hawk Republicans — take their seats.
