The Mortgage Asset Research Institute (MARI) has released their latest figures on mortgage fraud nationwide at the Mortgage Bankers Association's (MBA) National Fraud Issues Conference. Florida has replaced the once highest in the country as the hot-spot for mortgage fraud. Officials who attended the conference blame the decline in Georgia to the state's one year young law, which codifies mortgage fraud as a crime. New Jersey, Utah, Colorado, Oklahoma and California -- are considering similar legislation.  Colorado and Illinois are seeing more instances of fraud, while South Carolina has shown a marked improvement, according to the report.  Reported fraud in California is lower than it has been "in many years," the report also said.  "It shows the impact that state laws can have," California attorney Arthur Prieston, a specialist in fraud said. Utah's fraud problems have been consistently high, the report noted, even though the state has raised its standard for professional licensing and education and is pursuing more rigorous reporting requirements. 

Georgia's decline in fraud has been gradual, over two to three years. In 2003 they were rated at more than four times higher than the national average and far surpassed any state in the U.S. By 2004 they were only three times higher, and by 2005 they were just twice the national average. While Georgia remains the only state to specifically make loan fraud a criminal offense, their rate has only dropped to third highest in the country, and Utah moved up to second. The laws are getting people's attention according to Georgia attorney general, Thurbert Baker at the conference.

As housing sales slow, fewer people look for new mortgages.  Bank profits took their first hit in this slowing market last quarter.  Citigroup, J.P. Morgan Chase, Wells Fargo and Wachovia all reported falling mortgage sales.

Citigroup said sales declined in its U.S. consumer lending business because of reduced mortgage servicing revenues and the reduction in gains on the sale of real estate loans.  CFO Sallie Krawcheck told analysts that the bank is selling off its fixed-rate mortgages and holding onto variable rate mortgages.

J.P. Morgan Chase reported its net income from mortgage banking dropped from $139 million to $39 million.

Wells Fargo reported its home-mortgage revenue dropped to $853 million from $1.5 billion.

Wachovia reported 14% revenue growth in its General Bank unit, but said there was slowing growth in its home equity lines.

The Mortgage Bankers Association (MBA) predicts a 7% to 8% drop in home sales this year.  It also believes new mortgages and refinancings could drop 14%.  MBA reported a decrease in mortgage applications of 1.7% for the week ended April 14 compared to the prior week.

Freddie Mac, the king of home mortgages, faced record breaking news yesterday - but it's not the type of record any company wants to break.  Freddie Mac agreed to pay $3.8 million in civil penalties to the Federal Election Commission (FEC) - the largest fine in history. 

The FEC accused Freddie Mac of breaking campaign finance rules by improperly encouraging its corporate executives to donate money to candidates, as well as to sponsor fund raisers for Congressman that served on key Congressional committees. 

Freddie Mac is a federally charted corporation whose primary mission is to promote home ownership.  Since it is federally chartered, laws and regulations are in place to prohibit Freddie Mac from this type of campaign fund-raising activity.  Most corporations can and do assist Congressmen and Congresswomen with their fund raising.

Freddie Mac did not concede any wrongdoing, but it also did not contest the FEC ruling.

Dominion Homes Inc. and Wells Fargo Home Mortgage Inc. have finalized their mortgage-banking joint venture.

The new business, dubbed Centennial Home Mortgage LLC, will originate and fund mortgages for potential Dominion customers in the homebuilder's markets in Ohio, Kentucky and Indiana, as well as the general public.

The business will take over the mortgage-origination services, including qualifying borrowers and processing applications, previously handled by Dominion's mortgage-brokerage arm, Dominion Homes Financial Services Ltd.

"If you had told me we would have had this many people for a friggin' mortgage company opening--give me a break," said Donald Trump, speaking to several hundred people crammed into a lower level space at Trump Tower.
It's not typical that an 11 a.m. mortgage company launch could turn into a media circus.

"When Don [Trump, Jr.] and I struck the deal, we said, 'We'll have a new conference," continued Mr. Trump. "What we didn't expect was Extra!, Access Hollywood, Entertainment Tonight, and some of the other folks up here. Take a look Lois--my friend Lois [Weiss] from the New York Post."

Mr. Trump was joined by E.J. Ridings , the new company's President and CEO, and his son, who is also involved in the project.

"The business they're doing is unbelievable," said Mr. Trump in typically, grandiose fashion. "Literally, we signed the lease a few months ago, they are going to take an additional floor."

On Wednesday HomeServices of America Inc., said it acquired Huff Realty for an undisclosed price to expand in the U.S. Midwest. Huff, whose corporate offices are in Cincinnati and Fort Mitchell, Kentucky, is a residential real estate brokerage, mortgage and title company with 12 locations and more than 700 sales associates in Ohio and northern Kentucky.

The addition of Huff gives Minneapolis-based HomeServices more than 20,000 sales associates in 19 states. Known for its insurance holdings and investments, Berkshire has announced or completed at least four acquisitions this year.

Ameriquest Mortgage Co., has agreed to a judgment that will require it to clearly disclose loan terms and fees, not tamper with appraisals and set aside $26.6 million to pay restitution to California customers.

The judgment, entered Tuesday in Alameda County, spells out terms of a previously announced $325 million deal between Ameriquest and prosecutors in 49 states that in addition to the $26.6 million for California includes $175 million in nationwide restitution payments. Both sets of payments could raise restitution to customers throughout California to as high as $50 million, prosecutors said.

Prosecutors accused Ameriquest of using "bait and switch" and other misleading sales tactics, hiding loans' financial terms and prepayment penalties, arranging inflated property appraisals and encouraging prospective borrowers to fabricate income statements.
Ameriquest, based in Orange, denied any wrongdoing.

The injunction, which applies to Ameriquest's retail offices, requires the company to provide customers' with a one-page disclosure stating clearly whether it is fixed or variable rate. The disclosure, which must be handed over three days before the loan closes, must also reveal a loan's size, fees, points, monthly payments, interest rate and maximum prepayment penalties, and it must be available in Spanish or any other languages in which Ameriquest advertises.

The injunction also requires that Ameriquest tie loan terms to credit risk, limit its role in the appraisal process and protect whistle blowers. It forbids payment of sales incentives for getting consumers to agree to prepayment penalties and bars the company from soliciting refinancing transactions during the first 24 months of a variable interest mortgage.

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On The Mortgage Bus, clients are introduced to The Mobile Advantage: a revolutionary concierge service where mortgages, real estate sales and loan closings are being offered in a relaxed and convenient mobile environment. Customers are able to complete a loan application, select an interest rate and close their real estate transaction on board the bus. In addition to helping buyers with their loans, The Mortgage Bus is also available for realtor home tours, first-time home buying seminars, credit counseling workshops and more.

Mortgage lender Freddie Mac has announced James R. Egan will be starting April 3rd as a senior vice president, controller, and principal accounting officer.

Egan will report to Chief Financial Officer Martin Baumann. Prior to Freddie Mac, Egan was controller for MBNA America Bank, where he oversaw financial regulatory reporting and Sarbanes-Oxley compliance.

The decision is very important considering Freddie Mac is the nation’s second-largest buyer and guarantor of home loans and is recently emerging from an accounting scandal.