Freddie said that its revised loan sampling methodology "could further change in ways that further increase our repurchase request volumes with our seller/servicers."
Fannie Mae reported that as of March 31, its total mortgage loan repurchase requests by outstanding balance increased to $12.153 billion from $10.400 billion at the end of 2011, for a 17% increase during the first quarter. Of the new total, $4.259 billion in requests had been outstanding for over 120 days.
- Fannie's repurchase demands to Bank of America, N.A. totaled $7.057 billion as of March 31, increasing from 30% from $5.449 billion as of Dec. 31.
- Demands for JPMorgan Chase Bank, N.A. to repurchase mortgages increased to $1.251 billion from $1.136 billion.
- Demands for CitiMortgage (a subsidiary of Citigroup (C)) to repurchase mortgage loans from Fannie increased to $955 million as of March 31, from $917 million as of Dec. 31.
- Fannie's outstanding repurchase demands to Wells Fargo Bank, N.A. declined to $797 million, from $830 million.
- Fannie's demands for SunTrust Bank, Inc. (the main banking subsidiary of SunTrust (STI)), to repurchase mortgage loans declined to $380 million as of March 31, from $430 million as of Dec. 31. SunTrust
- Fannie Mae's outstanding mortgage purchase demands totaled $$1.713 billion as of March 31, increasing from $1.638 billion as of Dec. 31.
Fannie has agreements in place to "resolve certain outstanding repurchase requests" with CitiMortgage, Wells Fargo and SunTrust.
Fannie also reported that Bank of America had "slowed the pace of its repurchases," and that "as a result of Bank of America's failure to honor its contractual obligations in a timely manner, the already high volume of our outstanding repurchase requests with Bank of America increased substantially." The GSE also said that "Bank of America accounted for 71% of our repurchase requests that had been outstanding for more than 120 days as of March 31, 2012, compared with 59% as of December 31, 2011," and that one of the steps it took to address Bank of America's "delays in honoring our repurchase requests" was not renewing the "existing loan delivery contract with Bank of America at the end of January 2012, which significantly restricts the types of loans it can deliver to us."Bank of America said in its quarterly filing that its outstanding repurchase requests from Fannie and Freddie increased to $8.1 billion as of March 31 from $6.3 billion in December, and that "we continue to experience elevated levels of new claims from the GSEs, including claims on loans on which borrowers have made a significant number of payments (e.g., at least 25 payments) or on loans which had defaulted more than 18 months prior to the repurchase request, in each case, in numbers that were not expected based on past practices," and that "the criteria and the processes by which the GSEs are ultimately willing to resolve claims have changed in ways that are unfavorable to us." Bank of America continues to sell loans made through President Obama's expanded Home Affordable Refinance Program, or HARP 2.0, which allows mortgage loan borrowers with loans held by Fannie or Freddie to refinance their homes at today's historically low rates, no matter how much the value of the collateral property has declined.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV