August 2016

NOVASTAR FINANCIAL FILES FOR BANKRUPTCY

August 28, 2016 Lynn Szymoniak

 

Novation Companies, formerly known as NovaStar Financial, a company that made over $11 billion in mortgage loans that failed at very high rates during the housing crisis, filed for bankruptcy court protection in Baltimore on July 20, 2016.

NovaStar was a major participant in mortgage-backed securities.… [Read More]

NEW CFPB RULES TO THWART WRONGFUL FORECLOSURES

August 28, 2016 Lynn Szymoniak

The Consumer Financial Protection Bureau (CFPB) approved rules on August 5, 2016, to help prevent wrongful home foreclosures.

Mortgage servicers will be required to promptly notify borrowers when loss mitigation applications are complete.  Many mortgage servicers never considered an application complete and repeatedly demanded information and documents that the borrower had already provided. … [Read More]

The Disaster of American Loan Servicing

August 28, 2016 The Housing Justice Foundation

From David Dayen at Salon:

It shouldn’t be terribly difficult to accept a monthly loan payment from a homeowner or a student borrower, and to manage day-to-day operations on the loan. This is the job function of a servicer, a company that handles loans on behalf of the ultimate owner, funneling payments through the system and deciding how to manage defaults.

[Read More]