Tag Archives: Underwriting Standards

The National Credit Union Administration (NCUA) announced Monday it has filed suit against JPMorgan Securities and Bear Stearns over allegations of falsely representing the quality of mortgage-backed securities (MBS) sold to corporate credit unions. NCUA's complaint alleges that although Bear Stearns' offering documents described the firm's adherence to underwriting guidelines, the originators had in fact "systematically abandoned the stated underwriting guidelines in the Offering Documents."

Freddie Mac may ramp up repurchase demands with intentions to begin including mortgage loans made in 2004 and 2005 in its repurchase reviews.

Cincinnati-based eLynx announced its compliance with all guidelines for obtaining electronic signatures on Form 4506-T, Request for Transcript of Tax Return.

The economy, according to the Federal Reserve's Beige Book, expanded "at a measured pace" in seven of the 12 federal reserve districts--Cleveland, Richmond, Atlanta, Chicago, Kansas City, Dallas, and San Francisco. There was also "a somewhat stronger increase in activity" in Minneapolis and St. Louis. However, Boston and New York showed slower growth and weaker conditions attributable to Hurricane Sandy, and Philadelphia reported "general weakness that was exacerbated" by the storm. According to the Beige Book, business leaders and others "expressed concern and uncertainty about the federal budget, especially the fiscal cliff."

The RMBS Working Group filed a complaint against Credit Suisse for allegedly misrepresenting securities sold to investors.

Bank of America's Merrill Lynch unit lost in an attempt to throw out an action from the Federal Housing Finance Agency over mortgage-backed securities (MBS) sold to Fannie Mae and Freddie Mac. Merrill's motion to dismiss the case did not hold up under scrutiny from U.S. District Judge Denise Cote, who is overseeing claims filed by FHFA against Merrill and a number of other banks. Only days prior, Cote denied a similar motion filed by JPMorgan Chase.

A U.S. district judge squashed an attempt by JPMorgan Chase to fully dismiss a lawsuit from the Federal Housing Finance Agency over alleged securities fraud. In its motion to dismiss, JPMorgan argues that FHFA's complaint does not contain enough factual support that loans were not underwritten properly. Judge Denise Cote disagreed, saying the allegations "amply support FHFA's assertion that the Offering Documents for the Securitizations contained false statements regarding originators' compliance with underwriting standards."

Goldman Sachs is asking the U.S. Supreme Court to dismiss a mortgage securities class action lawsuit that the company says could cost Wall Street tens of billions of dollars, according to a report from Reuters. The bank is facing a suit from the NECA-IBEW Health & Welfare Fund, which is suing on behalf of investors who say they were misled about the securities' risk. Goldman's lawyers are arguing against the suit, citing a 2011 decision that investors may not sue over securities they did not purchase themselves.

The U.S. government is violating the terms of the national mortgage settlement with its lawsuit against Wells Fargo, attorneys for the bank argue. In a motion filed in a U.S. District Court, attorney Douglas Baruch says the settlement "wiped the slate clean for Wells Fargo in terms of facing any further liability to the United States (except in carefully crafted, narrow circumstances) for a wide range of Wells Fargo conduct relating to the bank's Federal Housing Administration (FHA) mortgage loan portfolio, among other areas."

Wells Fargo has issued thousands of refund checks to customers who paid unnecessary mortgage fees, according to a report from the Los Angeles Times.