Government

Parties to the landmark mortgage servicing settlement appointed one man to oversee $25 billion in compliance. In an interview with DS News, Joseph A. Smith, onetime banking commissioner for North Carolina and ex-nominee to head the Federal Housing Finance Agency, lays out the role he envisions playing as he monitors funds for homeowners, states, and the federal government. The settlement monitor speaks with an understated tone about his stewardship of the historic settlement, which 49 state attorneys general and federal officials completed in February.

In a speech to the National Council of State Housing Agencies on Monday, a Treasury official named a number of measures to address challenges in the housing market, and stressed one solution that has not been applied by Fannie Mae and Freddie Mac: principal reduction. Mary Miller, under secretary for domestic finance, says given the large percentage of outstanding mortgages that are currently backed by Fannie or Freddie, it is important that the GSEs participate in the principal reduction alternative of the Home Affordable Modification Program.

New homes sales fell 7.1 percent in March to a seasonally adjusted annual rate of 328,000, the steepest percentage decline since February 2011, the Commerce Department and Department of Housing and Urban Development reported jointly Tuesday. Sales for January were revised upward from 313,000 to 353,000. Economists had expected the report to show a seasonally adjusted annualized rate of 318,000 new home sales in March. New home sales in March were up 7.5 percent from March 2011.

The number of submissions for mortgage loan fraud suspicious activity reports (MLF SARs) for the full year of 2011 increased by 31 percent, or to 92,028, according to the Financial Crimes Enforcement Network (FinCEN). In 2010, 70,472 reports were submitted. Over the past several years, MLF SAR filings have been increasing on a yearly basis, with only 4,695 filings in 2001. In 2005, the number of filings made an upward climb to 25,988, then more than doubled 2009, when there were 67,507 filings.

The House Financial Services Committee signed off on legislation Wednesday that would repeal bailout funds under the Dodd-Frank Act and more than half the Consumer Financial Protection Bureau's (CFPB) budget. Clearing the legislation by a party-line vote, committee members billed it as a way to slash $35 billion from the national deficit.

An Alabama real estate investor agreed to plead guilty and serve prison time for his role in rigging bids and mail fraud at real estate foreclosure auctions, the Department of Justice announced Friday. To date, three individuals and one company have pleaded guilty in the investigation into fraud and bid rigging in southern Alabama.

The National Fair Housing Alliance (NFHA) filed a federal housing discrimination complaint against U.S. Bank on Tuesday following an investigation of the bank's properties. The NFHA stated that the investigation of 177 foreclosed properties owned by U.S. Bank showed that REO properties in African-American and Latino neighborhoods were not as well maintained and marketed as bank-owned properties in white neighborhoods. The U.S. Bank investigation evaluated REO properties in seven metropolitan areas.

While the term foreclosure victim generally brings to mind images of struggling homeowners, one report released by First Focus addressed the impact of foreclosures on an overlooked segment: children. Julia B. Isaacs of the Brookings Institution authored the report, which revealed five years into the housing crises, 2.3 million children have lost their homes to foreclosure, and 3 million more are at serious risk of losing their homes in the future. In addition, approximately 3 million children were evicted, or may face eviction, from rental properties.

California Attorney General Kamala Harris announced Tuesday that seven bills in the California Homeowner Bill of Rights passed out of legislative committees. Harris, who first introduced the bills in February, is pushing for permanent reform in her state since the $25 billion national mortgage settlement expands the course of three years. AB 2314 and SB 1472, which aim to fight neighborhood blight and increase fines against owners of blighted properties from $1,000 per day to $5,000, passed the assembly and senate judiciary committees.

Beginning June 15, real estate agents working with distressed homeowners whose loans are backed by Fannie Mae and Freddie Mac should expect to receive a decision on a short sale offer within 30-60 days. The GSEs issued new guidelines Tuesday that aim to bring greater transparency to the short sale process and expedite decisions related to these pre-foreclosure sales. Fannie and Freddie plan to use the new short sale timelines to evaluate servicer compliance with their Servicing Alignment Initiative.