Skip to comments.FHFA reviews GSE mortgage servicer contracts (Obama has bailed out Bank of America)
Posted on 12/10/2011 12:02:33 PM PST by Halfmanhalfamazing
The Federal Housing Finance Agency is looking into contracts between the government-sponsored enterprises and mortgage servicers to determine the best step to take when a servicer fails to perform well.
In the third quarter, Fannie Mae bought back mortgage servicing rights from Bank of America covering $74 billion in unpaid principal balance, according to its third-quarter financial statement. It was 11% of the Fannie loans being serviced by BofA.
(Excerpt) Read more at housingwire.com ...
The servicing rights are not the same as the mortgage. They are a separate stream of revenue from the actual mortgage repayments. It is a service provided by the servicer to the mortgage owner, for a fee of course. Early in the article, it says that the mortgages in question are owned by Fannie.
I’m not sure what’s going on here, but it isn’t the transfer of $74 Billion. More likely, the guv is looking for someone who charges less for the servicing. Maybe they are mad at BAC for the way it’s been handling foreclosures on their behalf through the RoboSigner foreclosure shops and lawyers that have popped up and caused bad publicity.
We were already on the hook for these loans, they have just stopped BOA from servicing them. Send newt a thank you note.
I would bet it is to spread the money around, you can bet these contracts are now serviced by some republicans friend. Buying votes is what it is called.
You are correct. Mortgage Servicing Rights (MSR) are different from the mortgages themselves. Actually, nothing wrong with this transaction. MSRs are sold all the time.
Would you rather have Uncle Sam nationalize the servicing rights like they do in Latin America? I don’t think so.