Kate Berry

Freddie Mac's top lawyer threatened to file suit against municipalities that attempt to use eminent domain to refinance underwater mortgages.

Even as policymakers plot its demise, Fannie is raising the prices it pays to community lenders for mortgage loans — outbidding large-bank aggregators like Wells Fargo and JPMorgan Chase.

Unlike their bigger competitors, smaller banks are resisting the temptation to pare staff or close mortgage production offices because they still see an opportunity to nibble away at large banks' market share.

The City of Richmond has sent offer letters to roughly 32 mortgage servicers and trustees requesting that it be allowed to buy underwater home loans at reduced prices. If the servicers balk, city officials say they will seek to seize the properties through eminent domain.

The Consumer Financial Protection Bureau's crackdown on Castle & Cooke Mortgage is the first in what could be a string of enforcement actions against mortgage originators for failing to follow new loan officer compensation rules.

Wells Fargo (WFC) said Thursday it will terminate eight mortgage joint ventures including a partnership with HomeServices Lending, an affiliate of Berkshire Hathaway.

A new report from the Tarp inspector general says the Treasury Department failed to analyze its own data to determine which borrowers were most at risk of losing their homes to foreclosure after receiving government support.

The Consumer Financial Protection Bureau filed a federal complaint Tuesday against Castle & Cooke Mortgage for giving bonuses to loan officers who allegedly steered consumers into mortgages with higher interest rates.

Receiving Wide Coverage ...Warehouse Probe: The Commodity Futures Trading Commission is examining the warehouse operations used by Goldman Sachs and others for the storage of aluminum that has inflated prices to consumers, the New York Times reports Tuesday. The operations were the subject of a Times story Sunday. The CFTC has told Goldman and other firms to hold on to internal documents and emails, hardly a good sign. The Journal weighs in, claiming banks have retreated from physical commodities markets even as Goldman, JPMorgan Chase and Morgan Stanley are cited for buying up oil pipelines, metal warehouses and power plants. A Senate committee is holding a hearing Tuesday on bank ownership of commodity assets, raising concerns that loose regulations have allowed banks to control the storage and shipment of commodities. The question is whether such activities pose a risk to the financial system. Senior officials at the Federal Reserve have discussed with bank executives whether to bar them outright from owning physical commodity assets, the Financial Times says.

Wells Fargo and Citigroup are laying off hundreds of employees in their mortgage units as rising interest rates cause home loan refinances to plummet. More layoffs by banks with heavy exposure to mortgages are expected this year.

Astoria Financial (AF) in Lake Success, N.Y., reported strong second-quarter results thanks to a decline in expenses and improving credit quality.

Bank of America says it can rebuild its share of the home loan market as rates rise, but its mortgage business relies more on refinancings than at other big banks.

On Tuesday the law firm Morrison & Foerster announced that it has hired Donald Lampe, who headed Dykema's financial services regulatory and compliance team, as a partner.

There is little proof that a doubling of guarantee fees in the last year by Fannie Mae and Freddie Mac has brought private investors back into the mortgage market, says the FHFA's inspector general in a new report.

The law firm BuckleySandler has beefed up its financial services practice with the addition of three heavy-hitting litigators all lured away from Dykema Gossett PLLC.

Delays in foreclosures — and in reimbursements to banks — are buying the beleaguered Federal Housing Administration more time to build its cash reserves.

Six regulatory agencies on Wednesday issued a proposal that would exempt three types of higher-priced mortgage loans from appraisal requirements.

For years banks treated certificates of deposit almost as an afterthought. But with loan demand expected to pick up with the economy, some are eyeing ways to lock investors into longer-term CDs now — before rates inevitably rise.

The strengthening economy helped, but the improvement in credit quality was also aided by the sale of poor-performing loans to servicers that are outside the federal banking system.

Issuers are adding another layer of protection at a time when lawmakers are examining how to wind down Fannie Mae and Freddie Mac and bring private capital back into the mortgage market.