Tags for this post: age limit for a 30 year mortgage, age limit for a 30 year mortgages, bank of new york subprime, ibm mortgage lending, ibm mortgages, maryland mortgage company regulators, mortgage regulators, reverse mortgage bank of new york mellon, subprime mortgage crisis bank supervision

Here Come the Mortgage Regulators
When I was a Marine recruit at Parris Island, when my platoon raised the ire of our drill instructors for whatever reason, the results would generally be most unpleasant. At least one of our four D.I.s (we were prohibited from calling them by that slang term) would charge through our barracks, Smokey the Bear hat cocked menacingly forward, scowl etched in place, ready to inflict pain upon us for the ineptitude we’d displayed. We knew from experience that we were in trouble.
At the same time, many lenders’ approach to their business may have spiraled so far from reality that some sort of tightening of standards is needed. Imagine making loans to customers with smudged credit histories and not requiring a down payment or the verification of income or employment. That, my friends, is precisely what has occurred on a not infrequent basis.

Futuristic mortgage foibles
The phantasmagorical new adjustable-rate, nothing-down, interest-only, no-employment-verification-needed mortgages that have spawned the current crisis are generally relatively new. Until the1980s, most mortgages were of the conventional 30-year, fixed-rate variety and were written by conventional financial institutions, including the predecessors of what are now J.P. Morgan Chase (NYSE: JPM) and Wells Fargo (NYSE: WFC), along with a raft of thrift institutions.
When operated against a backdrop of spotty regulatory oversight, this new mortgage mosaic was, we now know, destined to run into difficulty. Some of the lending institutions are overseen by the individual states, and others are under the watch of such federal authorities as the Office of the Comptroller of the Currency (OCC) (which regulates the nationally chartered banks) and the Office of Thrift Supervision (which is, as the name implies, the overseer of the thrift institutions). The state-chartered banks are regulated by a combination of the Federal Reserve (which also monitors the bank-holding companies), the Federal Deposit Insurance Corporation, and the respective state regulators.

Bank of New York Sells Stake in Mortgage Company
Bank of New York Co. (BK.N: Quote, Profile , Research) sold its 49 percent stake in joint venture BNY Mortgage Co. to EverBank Financial Corp., the majority stakeholder, for an undisclosed price, the companies said on Monday.
BNY Mortgage says it is the fifth-largest U.S. provider of reverse mortgages, which let people borrow against equity in their homes and convert what they borrow into cash.
Privately held EverBank is based in Jacksonville, Florida. Alliance Mortgage Co., an EverBank predecessor, entered the venture with Bank of New York in 1999. BNY Mortgage will keep its name for a year, Sivori said. Bank of New York’s merger with Mellon is slated to close around July 1. The combined company, to be known as Bank of New York Mellon Corp., will be one of the world’s largest custody servicers and asset managers. Shares of Bank of New York fell 10 cents to $40.71 in afternoon trading on the New York Stock Exchange.

IBM Forms New Loan Fulfillment Services Company To Specialize In Mortgage Origination Services
IBM(NYSE: IBM) has announced the formation of a new business unit, which will specialize in mortgage origination services. IBM Lender Business Process Services, Inc. (LBPS), a wholly owned subsidiary, will enable mortgage lenders to replace the fixed costs associated with typical loan fulfillment operations with a variable cost framework, freeing up lenders to focus more on providing better personal service and support to consumers.
“There is a fundamental shift in how the mortgage industry uses technology and automation to achieve the kinds of efficiencies required to thrive in the new lending economy,” says Af Assur, general manager, IBM Mortgage Origination. “Lenders need a partner like IBM who can invest to automate the total loan fulfillment supply chain on their behalf, to give them the competitive advantage they need. By integrating fulfillment and imaging technologies, proven processes and highly experienced lending professionals, we will deliver the automation and digitization necessary to help achieve the loan fulfillment efficiencies and service required for success.”

Buy-to-Let Mortgage For 102 Year Old
A 102 year old man has been allowed a buy-to-let mortgage for £200,000, due to be paid off over 25 years - if he survived this term he would be the oldest person in world history…
The risky mortgage deal was taken out with Mortgages for Business, a firm in Kent who do not impose an age limit on lending - unlike many who state that people must be no older than 75. They have helped many pensioners buy their own homes in recent years - a market that was previously unheard of as it would have been difficult to get a mortgage even at the age of 65 only five years ago.
The 102 year old has however taken out the mortgage as an investment with his family, and repayments are being covered by the current tenancy so there should be no problems repaying the loan - the only risk would be if rental yields fell suddenly, but the area in the southeast has a strong property market. The rise in elderly people taking out buy-to-let mortgages is thought to be linked to the pension crisis, as any individuals are not getting enough income to live off.

Subprime Mortgage Foreclosures by the Numbers
The rise in subprime mortgage foreclosures poses looming threats to the housing market, mortgage lenders, and homeowners across the country. The Center for American Progress released a report on the issue earlier this month entitled “From Boom to Bust: Helping Families Prepare for the Rise in Subprime Mortgage Foreclosures.�?

The report outlines the problems that some homeowners are currently facing and details policy solutions that would help families deal with the crisis. According to the report, policymakers should consider:

* Federal grants to expand and enhance current mortgage assistance and foreclosure prevention programs and low-interest mortgage assistance to eligible borrowers.
* Federal funds to target key cities and states facing the highest risk of mass foreclosure.
* Provisions to ensure federal agencies assess the effectiveness of each program every three years.
* Strengthen programs that aid families while their mortgage contracts are renegotiated or the property is sold on the market so that the homeowners’ credit ratings are salvaged, allowing for the possibility of future homeownership.

Sector Snap: Mortgage Lenders
While Vencil said he’s not sure whether he agrees with the market’s interpretation of the report, he said it certainly doesn’t show the housing market is stronger than people thought.
The mortgage industry’s fortunes are tied to housing in several ways. If fewer people are looking to buy homes, fewer people are applying to borrow money. Plus, houses act as collateral for a number of different types of debt that mortgage lenders sell to investors. If the collateral loses value, so do the loans the collateral secures.
Among the mortgage industry’s biggest decliners, Accredited Home Lenders Holding Co. fell 67 cents, or 5.7 percent; IndyMac Bancorp Inc. fell 79 cents or 2.6 percent, to $29.21; and Washington Mutual Inc. fell 79 cents to $41.42.

Rise of 25-year fixed-rate mortgage
The move comes amid predictions of further interest rate rises, prompting a surge of consumer demand for “locking in” rates.
Recent research from the Council of Mortgage Lenders suggests that around 75% of first-time buyers and 70% of home movers are opting for fixed-rate products.
Stuart Bernau, executive director at Nationwide, said the mortgage offered long-term good value to borrowers looking for the security of fixed payments and the flexibility of a 10-year deal. Julie Harris, mortgage analyst at moneyfacts.co.uk, said: “Due to recent rises in interest rates it seems that the Nationwide is reacting to a greater demand for longer-term fixed rates. “A fixed rate can give borrowers additional peace of mind at a time when some experts are predicting another rise.

U.S. subprime crisis exposes mortgage scams
Gabriellee Cunningham had fallen behind on the mortgage on her modest suburban Miami home and was mired in debt when she was approached in June by a door-to-door “mortgage lender” who promised to help her. Nine months later, her US$89,000 mortgage has ballooned into a US$234,000 loan, her monthly payments have doubled and she faces foreclosure on a house she no longer owns.

Housing officials call Cunningham the victim of one of the worst cases of predatory lending they’ve ever seen and warn, as the U.S. subprime mortgage crisis grows, of a rising tide of scams in which homeowners are being cheated out of their home equity.
“We have that combination of people behind in their mortgages who have equity in their property,” said NCLC attorney Lauren Saunders. The equity makes them attractive targets for cons. At least 12 states — California, Colorado, Georgia, Illinois, Maryland, Michigan, Minnesota, Missouri, New York, Washington, Florida and Rhode Island — have passed consumer protection laws against foreclosure scams.

But Saunders said the laws do not carry blanket protections and cannot guard against scammers who quickly flip a property and make off with the cash. “If you’re signing away your home you’re signing away your home,” she said. “Don’t expect to ever get it back.”

Subprime mortgage crisis may hurt auto loans: S&P
orrowers faced with resetting home loans may have “less cash flow available for other expenses, including auto loan payments,” S&P analyst Mark Risi said. Securities backed by subprime mortgages have sunk in value in recent weeks as investors have grown worried about rising delinquencies and their potential impact on the broader U.S. housing market.

Some investors fear that the subprime mortgage crisis could spread to higher-rated mortgages, or even other sectors, like autos. “With the subprime problems not going away and actually looking like they are spilling over into other subprime lending areas like auto loans, people are looking for ghosts,” said Joe Francomano, vice president of foreign exchange at Erste Bank in New York.