Government

Acknowledging improvements in the larger economy, the Federal Open Market Committee said Tuesday that it would keep a heel on zero interest rates and continue shepherding funds from mortgage-backed securities into agency mortgage-backed securities. The rate for federal funds remains between zero interest and .25 percent since December, and follows an earlier decision by the Fed to buy up $400 billion in Treasuries to ensure lower borrowing costs.

Speaking before the Senate Banking Committee Tuesday, the inspector-general of the Federal Housing Finance Agency portrayed the agency as one beset by failures to adequately monitor and validate controls for executive compensation, examinations, and more. IG Steve Linick referenced a recent report from his office that found the FHFA needs to improve by taking measures to independently validate executive compensation packages. Compensation approval methods proved controversial last month.

Members of the Senate Banking Committee voted Tuesday to send nominees for top posts at the Federal Housing Administration and Federal Reserve Board to the full Senate floor. Lawmakers approved FHA Acting Commissioner and former BRIDGE Housing CEO Carole Galante 13 to 9 on a largely party-line vote, with only Sen. Bob Corker (R-Tennessee) breaking ranks with GOP faithful to cast in favor of the nominee. Thomas Hoenig meanwhile moved to the Senate floor on a unanimous vote.

In Seattle, Washington, one lender has cause for celebration as we head into the new year. West Coast Bank has been named as the recipient of the 2011 Community Spirit Award, which is given annually by the Federal Home Loan Bank of Seattle. The special honor is extended yearly to a financial institution that is recognized as exemplifying the spirit of community partnership in creating affordable housing and economic development opportunities in its immediate region.

The commercial real estate market in the U.S. appears set for an uptick in 2012, but don't expect a headline-making rise. According to recent research from Jones Lang LaSalle, economic indicators are pointing to a modest improvement in the commercial segment, and data from the company also reveals that rumors of a double dip in the sector during the coming year were premature. Numbers from the survey call for an increase in total transaction volume of 15 to 20 percent.

At least one key trade group opposes plans by some lawmakers to introduce a raise for mortgage fees in a payroll tax extension. Congress is essentially proposing to raise taxes on millions of potential home buyers in order to pay for a payroll tax cut and other non-housing legislative initiatives, NAHB chairman Bob Nielsen said in a statement. Lawmakers are busy cobbling together a payroll tax plan this week that would extend current rates for employees and their employers.

DebtX announced Monday that it is now the exclusive agent for a sale involving $334 million in loans from a real estate fund that collapsed and filed for Chapter 11 bankruptcy. In a statement, the company said that loans involved in the sale primarily involve Acquisition, Development and Construction loans backed by land from nine U.S. states. Eighteen loans will go for sale. This includes tens of millions of dollars in non-performing loans from California and Wyoming.

Joining a list of other mortgage fraudsters Monday, three Cleveland residents received jail time for their role in a multi-million-dollar scheme while two others in Maryland and Virginia saw their names in fine print over $700,000 in fraud. Home went into foreclosure as a result of much of the alleged crimes. MReport collected the stories from a bevy of news sources that include the FBI and a Cleveland news outlet. This comes on the heels of other mortgage fraud activity as it increases nationally.

Borrowers using Mortgage Lenders USA will now have the advantage of faster quotes when seeking a mortgage. The company announced recently that it would initiate a 24-hours or less policy in extending a mortgage quote to inquiring parties.

In Georgia, Flagstar Bancorp has officially sold its 27-branch retail bank franchise to PNC Bank, N.A. The deal, which was announced earlier this year, has reached its conclusion, and PNC Bank will now take possession of all leases associated with the locations, as well as all associated business and retail deposits. The purchase agreement for its Georgia locations follows Flagstar's December sell off of its Indiana branches. The total number of bank franchises sold stands at 49.