Tag Archives: Lenders & Servicers

Residential Capital was denied approval from a federal bankruptcy judge to pay its executives bonuses, Reuters reported Wednesday. The key employee incentive plan was for bonuses between $4.1 million and $7 million to be distributed to 17 of the top 20 employees from ResCap. The written court opinion stated the debtors, or ResCap, argued the bonuses would serve to "motivat[e] . . . key talent" during a sales process that has required ResCap employees to assume "responsibilities above their normal duties," and subject them to ├â┬ó├óÔÇÜ┬¼├àÔÇ£extraordinary stress, pressure, and uncertainty as to the security of their jobs."

While fraud in the financial services sector declined year-over-year from April through June, mortgage fraud increased, according to the latest report from Experian, a global information services company based in London. Thirty-nine out of every 10,000 mortgage applications were fraudulent during the April to June period, up from 32 out of 10,000 in the same period last year, according to Experian. Mortgage fraud far outpaced savings account fraud.

After a month of weekly increases, mortgage rates followed Treasury bond yields down this week. Freddie Mac reported that the 30-year fixed averaged 3.59 percent (0.6 point) for the week ending August 30, down from 3.66 percent in the previous week├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós survey. The 15-year fixed also fell, dropping to 2.86 percent from 2.89 percent. In addition, both the 5-year and 1-year adjustable rate mortgage averages fell, declining to 2.78 percent and 2.63 percent, respectively.

Personal income rose $42.3 billion in July but consumer spending increased $46.0 billion, the Commerce Department reported Thursday. The increase in income ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô 0.3 percent ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô topped expectations of a 0.3 percent boost, and the 0.04 percent increase in spending also met economist expectations. The Mr. Micawber-like report ("Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery," per Charles Dickens) meant personal savings dropped in July.

First time claims for unemployment were unchanged at 374,000 for the week ended August 25, the Labor Department reported Thursday after revising upward by 2,000 the prior week├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós originally reported 372,000 claims. Economists surveyed by Bloomberg had expected 370,000 initial claims. Continuing claims ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô reported on a one-week lag ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô dipped 5,000 to 3,316,000 from the prior week's 3,321,000, revised from the originally reported 3,317,000. The BLS report will be published September 7. From mid-July to mid-August, first time claims are down 14,000 but continuing claims.

Sales of single-family homes in the Bay State continued their steady rise in July, The Warren Group reported Tuesday. A total of 4,979 single-family homes sold statewide in July, up from almost 27 percent year-over-year. This July was the best for sales volume since 2005, when sales reached 6,672. Year-to-date, 26,596 homes have sold in Massachusetts, a 24.8 percent increase from the same period in 2011. July also saw condominium sales increase in the state, rising 34 percent year-over-year.

Five months after the nation's top five servicers settled with the states attorneys general and several federal agencies to address iniquities in foreclosure processes, Joseph A. Smith, Jr., the settlement monitor, released a preliminary report to inform the public of the servicers' progress so far. Thus far, the five servicers ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô Bank of America, JPMorgan Chase, Wells Fargo, Citigroup, and Ally Financial ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô offered $10.56 billion in relief to borrowers and have implemented between 35 and 72 percent of the 304 servicing standards detailed in the national settlement.

The nation's economy expanded gradually from early July through mid-August, the Federal Reserve reported yesterday in its periodic Beige Book. The description of the economy, drawn from reports from each of the 12 Federal Reserve districts differed from the usual tone of Beige Books which have recently described economic growth as "modest" or "moderate." Six Districts, according to the Beige Books, "indicated the local economy continued to expand at a modest pace.

In another positive sign for the housing sector, the Pending Home Sales Index rose 2.4 percent in July to 101.7, its highest level since April 2010, the National Association of Realtors reported Wednesday. Economists had expected a 1.0 percent increase to 100.3. The July increase more than reversed an unexpected 1.4 percent drop to 99.3 in June. The only negatives in recent reports were a slight drop in housing starts in July and drops in the median price for existing and new homes in July.

The U.S. economy grew in the second quarter at 1.7 percent, slightly faster than the originally estimated 1.5 percent, the Bureau of Economic Analysis reported Wednesday. At the same time BEA reported second quarter grew at a meager 0.5 percent from the first quarter, but an improvement from the 2.7 percent drop in corporate profits registered in the first quarter. Profits in the financial sector though fell more than 9 percent. The upward revision in second quarter GDP growth was in line with the forecast by economists surveyed by Bloomberg.