Economy

WASHINGTON — The Financial Stability Oversight Council is encouraging mortgage agencies to continue clarifying when lenders must repurchase defective loans.

The proposed legislation for regulatory relief seeks to roll back critical mortgage protections put in place to prevent another housing crisis.

Critics of the regulatory relief bill proposed by Sen. Richard Shelby argue that will endanger the financial system and benefit big banks. But in fact, the changes offer sensible, nonpartisan fixes to some of the biggest problems with the Dodd-Frank Act.

The Rural Housing Service should merge with the Federal Housing Administration to save money and improve service, the head of the Government Accountability Office testified Tuesday.

Lost in the debate so far over Shelby's regulatory relief bill are the significant changes it makes to the housing finance system. It essentially takes consensus elements from multiple past stabs at reform, leaving out the most controversial parts and making future reform far easier.

Critics concede Bitcoin's innovations may change finance but predict the system itself isn't long for this world. Nasdaq is challenging that idea by not only testing Bitcoin's much-vaunted blockchain technology, but doing so on the Bitcoin network.

It's a good idea to raise the asset threshold at which financial institutions are automatically designated as systemically important financial institutions. But Sen. Richard Shelby's proposed legislation for regulatory relief does require one crucial change.

The regulatory relief package coming before the Senate Banking Committee Thursday would force the Federal Housing Finance Agency to withdraw the contentious proposal within 30 days.

No bank has fully disclosed what it spends on the Federal Reserve's Comprehensive Capital Analysis and Review, in part because the figure is hard to isolate. It's a key piece of information missing in the debate over banks' regulatory burden.

As major banks have pulled back from originating Federal Housing Administration single-family loans, nonbank mortgage lenders have become bigger players in the Ginnie Mae program.

JPMorgan Chase CEO Jamie Dimon defended his institution by arguing that size isn't necessarily an indicator of risk. But the truth is that the larger an organization gets, the more complex it becomes-and the more difficult it is for leaders to keep everything from customer service to fraud prevention working the way it should.

So far, Washington has generally smiled on tech-driven lenders such as Lending Club and OnDeck. But many in the fast-growing industry are now bracing for closer scrutiny.

The Federal Housing Finance Agency provided more details Friday about key features for the new single security that will be issued by Fannie Mae and Freddie Mac.

Sen. Richard Shelby's attempt to reform Dodd-Frank could ease key bank regulations that improve the safety and soundness of big banks. That would be an immense disservice to the American taxpayers who might bear the cost of the changes with future bailouts.

JPMorgan Chase has purchased $45 billion in servicing rights from embattled mortgage firm Ocwen Financial.

Other regional Federal Home Loan Banks are lining up so their members can securitize FHA and VA loans through Chicago FHLB conduit.

With support from Bank of America, a nonprofit lender is trying to revitalize Detroit by offering no-down-payment mortgages at up to 150% of a home’s assessed value. The idea is to provide borrowers with enough cash to buy run-down homes and fix them up, and if the program works as promised it could prove to be a template for lending in other cities — like Baltimore — that have large swaths of boarded-up homes.

With the release of Sen. Shelby's regulatory reform bill, the debate over the legislation is just beginning to take shape. We sort through the possibilities for how it will unfold.

Many lenders shy away from adjusting monthly payments based on struggling borrowers' income for fear of losing too much money, but the Education Department's expansion of such plans for student loans and new data-crunching products have reframed the longtime discussion.

Federal Deposit Insurance Corp. Chairman Martin Gruenberg, discussing progress in establishing big-bank resolution regimes, said the Federal Reserve is developing a rule "to codify" the swaps protocol involving termination rights.