GMAC Financial Services announced that it received a $3.79 billion capital infusion from the U.S. Department of the Treasury. The transaction was structured with $2.54 billion in trust preferred securities and $1.25 of mandatorily convertible preferred securities. A $15 billion government package was announced by GMAC in May, while the company obtained $5.0 billion in capital investments under Troubled Asset Relief Program a year ago.
The mayor’s office in Shelby County, Tenn., announced that a lawsuit was filed against Wells Fargo. The company is accused of causing increased foreclosures through predatory lending to minorities. An activated U.S. Marine has filed a lawsuit against Wells Fargo Home Mortgage, FOX news reported. Wells allegedly violated the Soldiers and Sailors Civil Relief Act.
2 Wells Fargo Units Face Lawsuits
A lawsuit was filed by Colorado’s attorney general against Alternative Lending of Colorado, according to a recent announcement from the state. The state claims the company’s top originator commited mortgage fraud and deceived prospective borrowers. A former employee of Mortgage Network Solutions in Pennsylvania was arrested over allegations she diverted $29,000 in appraisal payments from the company to three accounts she controlled at different banks.
The rest is here:
Criminal Mortgage Actions
Deutsche Bank AG filed a lawsuit against Bank of America, N.A., according to a copy of the complaint. BoA allegedly failed to secure and safeguard more than $1 billion in cash and mortgages originated by failed Taylor, Bean & Whitaker Mortgage Corp. Morgan Stanley was sued over allegations it promoted a collateralized-debt obligation while betting against the underlying loans that were originated by failed New Century Financial Corp. and Option One Mortgage Mortgage Corp. A former IndyMac Bancorp Inc. trustee has sued IndyMac’s former chief executive officer directors for allegedly squandering the failed firm’s assets and ignoring warning signals.
The National Association of Mortgage Brokers said it issued a letter to the Federal Reserve Board asking for a delay in the implementation of a final rule that would prohibit broker compensation on closed-end mortgages based on the loan’s terms or conditions. But the Center for Responsible Lending says the Fed should strengthen — not delay — its proposal. “These kickbacks are easy to hide from consumers, and they encourage brokers to aggressively market the worst kinds of loans — even when their customers qualify for better,” the center said.
Consumer Group Takes on Broker YSPs
The National Credit Union Administration is proposing to provide more clear guidance about who credit unions can target for membership when they are seeking a new charter or expanding. The objective is to make it easy for applicants to determine whether they have a viable charter before dedicating resources to the application process. In addition, the NCUA will expend fewer resources reviewing and declining applications.
New Rules for Credit Union Membership
November new business acquisitions fell by more than a quarter from the prior month at Fannie Mae, according to monthly operation data. The company’s book of business declined by $186 billion from October. Record residential delinquency increased another 26 basis points between September and October.
Here is the original:
Deterioration Deepens at Fannie
Two class actions have been filed by purchasers of pass-through certificates issued by Structured Asset Mortgage Investments II Inc. and Bear Stearns Asset-Backed Securities I LLC, according to a news release. The Securities and Exchange Commission filed a criminal action against Brookstreet Securities Corp. and its chief executive officer. The SEC claims that between 2004 and 2007, the defendants systematically sold high-risk mortgage-backed securities to investors with conservative investment goals.
MBS Litigation Ledger
The U.S. Department of the Treasury announced that the program established under the Housing and Economic Recovery Act to purchase GSE-guaranteed mortgage-backed securities will end on Dec. 31. The Treasury also said it would amend the preferred stock purchase agreements that were established to ensure both firms maintain a positive net worth are being increased from $200 billion for each firm to whatever is “necessary to accommodate any cumulative reduction in net worth over the next three years.”
See the rest here:
GSE Losses Could Cost Gov Over $400 Billion