Federal Housing Finance Agency Office of Inspector General Semiannual Report to the Congress – Housing Regulator Failed to Stop Fannie, Freddie Mortgage Issues

Inspector general says housing regulator failed to stop Fannie, Freddie mortgage issues

WASHINGTON — A government watchdog said Fannie Mae and Freddie Mac improperly foreclosed on homeowners and cost the government billions of dollars by not holding major banks to strict underwriting requirements.

The report released Tuesday also said the Federal Housing Finance Agency gave “undue deference” to Fannie and Freddie officials and didn’t scrutinize more than $35 million in bonuses and compensation to Fannie and Freddie executives.

FHFA’s inspector general had previously released each of the findings on an individual basis. But the semi-annual report to Congress sketched a portrait of abuse at the two mortgage giants that the government failed to stop.

The AP Article then goes on to say…

The inspector general report found that Fannie and Freddie did not force banks to repurchase mortgages when they failed to meet strict underwriting requirements. That decision cost the government billions of dollars.

When a senior examiner at FHFA raised “serious concerns” about Freddie’ process for reviewing Bank of America’s mortgages, senior Freddie managers disagreed, according to the report. The managers also said they feared losing business from Bank of America if the government became more aggressive in getting money back for bad mortgages, the report said.

The report also found:

Fannie knew about allegations of improper foreclosure practices by law firms as far back as 2003 but did not act to stop them.

Fannie failed to establish an “acceptable and effective” way to monitor foreclosure proceedings between 2006 and early 2011.

— FHFA failed to oversee the government’s signature foreclosure-prevention program, the Home Affordable Modification Program. As a result, it cost the government extra time and resources to fix it.

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2 Responses to “Federal Housing Finance Agency Office of Inspector General Semiannual Report to the Congress – Housing Regulator Failed to Stop Fannie, Freddie Mortgage Issues”
  1. Eugene Villarreal says:

    Why would Freddie( & Fannie ) fear losing business ? They are the only suckers to continue buying mortgages without any regulator oversight to this day. The banks (Servicers) are still holding the ” Fraud Card ” on Freddie & Fannie because the GSEs instructed the (Servicers) to foreclosure under the Servicer’s name instead of GSE’s name as the alledged lender/assignee…. and then return the mortgage back to the GSEs after auction sale. The homeowner who is not at the table is the only one who loses. Homeowners, attorneys, judges and the government all know this. How many government reports, appellate decisions and state supreme court decisions will it take for trial court judges to do their duty and stop these fraudulent foreclosures in their courts.
    Yesterday, in New Jersey there was a state supreme court case on the webcast and bank’s attorney was trying to tell the judges to reinterpet the state’s statues on the state’s Fair Foreclosure Act and use more discretion ( in their favor of coarse). Also, the new affirmation that are required by the plaintiff’s attorneys were too strict are the attorneys were not willing to lose their licenses over a signature and that there was going to be a backlog 200,000 foreclosure cases. The defendant’s attorney afterward stated that it was the banks fault for the backlog due to mistakes(?).

    • Herb says:

      I have an investigation going on right now. I had GMAC but was left out of the settlement that GMAC had to send checks out to borrowers, but they never registered the servicing and they are not in my records so the borrower is out yet again. First they give the fake loans to GMAC and Oswin then they hand it to NATIONSTAR, they give it another loan number, then foreclose, then resell the loan with another loan number, and Fannie Mae takes the loan gives it another loan number and gets bailed out for four different loan numbers on the same forged loan, and this is just my fake mortgage I rescinded on the same day as the closing for document errors. They have MERS working this scam for years, and do you know that MERS and Fannie and Freddie are in cooperation to fraud? One lies and the other swears to it then they foreclose and collect from Mortgage insurance and the bailout, and the foreclosure, then from the borrower, as many times as they please. All from one signature you give them for a mortgage loan they never put money into. Your signature was put on a promissory note and deposited into the bank, then fractional banking kicks in, and they get 9X the Mortgage amount of the Mortgage back. Did they disclose to you that they used your own money to lend back to you with interest and also collected 9X that loan? Did not think so. these banks are robbing this country blind and we actually give up our signatures for it. What sucker we are.

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