Government

Nearly 12 percent of home purchase loans in today’s market run the risk of default in the event of an economic downturn, according to a new report from the American Enterprise Institute’s (AEI) International Center on Housing Risk. According to AEI, last month’s rising index was caused largely by the Federal Housing Administration (FHA) and Rural Housing Services (RHS) increasing their market share, which was up to an estimated 32.2 percent in April.

As part of its efforts to improve consumer housing education, HUD announced it was given out an additional $40 million in grants to national, regional, and local organizations nationwide to aid housing counseling programs. HUD projects the housing grants will help assist more than 1.5 million households find housing, keep their current homes, and make more informed housing choices.

A mayor in the Miami area has been suspended by Florida Gov. Rick Scott following a federal indictment alleging mortgage fraud. According to a report from the Miami Herald, North Miami Mayor Lucie Tondreau was suspended Tuesday after appearing in court to face charges related to her role in an $8 million fraud scheme.

Speaking before an audience in Boulder, Colorado, Consumer Financial Protection Bureau (CFPB) Richard Cordray addressed the growing amount of student loan debt—$1.2 trillion and counting—and how it will have negative ramifications on the housing market in the future.

The New York regulator who earlier this year launched a probe into the practices of non-bank mortgage servicers revealed Tuesday he plans to expand his investigations. Delivering remarks at the Mortgage Bankers Association' 2014 National Secondary Market Conference, Superintendent Benjamin Lawsky of New York's Department of Financial Services said the agency plans to dig into fee-based ancillary services at non-banks such as Ocwen and Nationstar.

President Obama is expected to choose San Antonio Mayor Julián Castro to replace Shaun Donovan as HUD secretary following Donovan's move to the Office of Management and Budget, according to a report from the New York Times. This is the second overture the White House has made to the San Antonio mayor.

Results released in QuestSoft's latest annual survey of lenders shows the Consumer Financial Protection Bureau (CFPB) continues to rank high on the list of worries gnawing away at businesses. "Compared to last year's survey, lenders appear more weary than ever of CFPB's rules, as non-CFPB issues are seen as increasingly lower priorities," said Leonard Ryan, founder and president of QuestSoft.

An Illinois bank has closed its doors for good, bringing the national tally of FDIC-insured bank collapses to seven so far this year. The agency announced Friday the closure of AztecAmerica Bank, which was shut down by the Illinois Department of Financial & Professional Regulation. The bank, based in Berwyn, is the state's second failure of 2014.

The Johnson-Crapo housing finance reform bill, which would phase out Fannie Mae and Freddie Mac in favor of a more limited federal insurer, has passed through the Senate Banking Committee. While the bill always had enough support in the committee to make it to the Senate floor, whether or not it goes any further is the real question.

According to examination results released Wednesday by the Office of Mortgage Settlement Oversight, five of the six banks met or exceeded expectations across 29 different compliance metrics in the third and fourth quarters of 2013. Not faring as well was Green Tree, a wholly owned subsidiary of Walter Investment Management Corp., which has part of ResCap's servicing portfolio.