Mortgage Lending

HUD reviving efforts to reform rules on mortgage lending Department of Housing and Urban Development Secretary Alphonso Jackson is reviving efforts to reform mortgage-lending rules to make loan costs more transparent. The agency plans to hold six meetings from July 14 to Aug. 18 seeking public and industry comments on reforms to a 30-year-old consumer-protection law known as Respa, the Real Estate Settlement and Procedures Act, Jackson said. Americans spend $55 billion on closing costs a year, according to a HUD statement.

PeopleMary Ellen Marsalek has been appointed to the post of assistant vice president/market manager at the Commercial and Farmers Bank in Ellicott City. She will be responsible for business development, commercial lending and branch operations at several locations. Kevin Huffman has been promoted to senior vice president. He will oversee the technological aspects of the organization.William J. Allen has been named vice president of residential mortgage lending for the Columbia Bank, a commercial bank headquartered in Howard County.

The NAACP and the American Civil Liberties Union have accused PHH Corp. of discriminatory mortgage lendingpractices in Philadelphia, a charge that the Hunt Valley-based company denies.In a complaint filed Thursday with the Pennsylvania Human Relations Commission, the two groups say PHH U.S. Mortgage Corp. of Mount Laurel, N.J. -- PHH's mortgage lending division -- unfairly denied loans to African-Americans and rejected loans for properties in Philadelphia's black neighborhoods.PHH contends that it has programs and safeguards that prevent bias in lending.

Provident places mortgage lending programs on webMortgage lending programs offered by Provident Mortgage Corp. are now available on the Mid-Atlantic Real Estate Information Technologies web site at http: //www.marit.com.MARIT's web site contains information and photographs on roughly 14,000 homes in central Maryland. After finding a home, browsers can get information on mortgages, interest rates, prequalification and refinancing by clicking on Provident's name in the service directory.Provident Mortgage Corp.

Washington -- Homebuyers in dozens of large cities across the country will soon be able to pick up their phone at any time during the day or night and within minutes find out precisely how much of a house they can afford, how their current credit rating stacks up, and what size mortgage they can handle.The service will be free, confidential, utterly low-tech for the consumer -- all you'll need to access it is a touch-tone phone -- and will not commit users to any particular loan type or lender.

The nation's housing market will rebound somewhat from a poor winter, with mortgage interest rates likely to stabilize or decline slightly by the end of the year, the Federal National Mortgage Association said last week.Even so, home sales for 1995 should come in behind last year's pace, by about 6 percent to 7 percent, Fannie Mae predicted.And Maryland, in the bottom five states in the nation in job growth, will likely continue to lag behind the nation in home sales, according to David W. Berson, chief economist at Fannie Mae."

2 venture capitalists work to ease creditAlmost a decade ago, venture capitalists Harvey Branch and Bill Gust went out and raised $19 million for what they called Chesapeake Ventures. Now that Chesapeake is winding down, the partners are looking around for something new. They believe they've found an opportunity in the credit crunch for small, low-tech businesses.Last year, Mr. Branch and Mr. Gust tried to raise about $40 million from some public pension funds. Their plan: to invest the money in conservative securities and use the nest egg to provide credit guaranties for small businesses to borrow money from banks.

As racial bias in mortgage lending comes under more scrutiny by consumers, government officials and the banking industry, some local lenders have broken with tradition to reach more minorities.In Maryland, lenders are playing new roles, those of educator rTC and counselor. To attract more business from low-income neighborhoods, they're offering salaries or higher commissions to loan representatives. And they're forging ties to community groups and brokers familiar with minority neighborhoods.

WASHINGTON -- The federal government will take a more aggressive approach to combating discrimination in home mortgage lending, including probing banks' willingness to accept Veterans Administration and Federal Housing Administration loans and allegations that they market only to whites, a Department of Justice official said Tuesday.The government will go beyond simply examining figures that show blacks are rejected for mortgage loans at levels more than twice as high as whites of similar incomes, said John R. Dunne, assistant attorney general in charge of the civil rights division.

CHICAGO -- If the banking industry had a red "alert" button, it was pushed with a study by the Federal Reserve Bank of Boston that showed racial discrimination is a fact of life in home mortgage lending.The Boston bank's one-year investigation, released late last month, concludes that, all other factors being equal, black and Hispanic mortgage applicants are roughly 60 percent more likely than whites to be denied loans.The study, anticipated by the nation's banks, was the second of a one-two punch to an industry that has long denied that it discriminates.

The head of a financing company planning to acquire Towson-based AmericasBank Corp. and inject the bank with more than $35 million in cash and assets said Tuesday that he sees a growing need for community banks in Maryland. Jack Dwyer, owner of Baltimore-based Capital Funding Group, said the next step for his company is to become a bank. Dwyer formed Capital Funding Bancorp Inc. this year and he announced Tuesday the acquisition of AmericasBank, a small Maryland bank hit hard by mortgage-lending losses last year.

Fannie Mae and Freddie Mac, two mortgage lending giants that hold or guarantee about half of the nation's $12 trillion mortgage market, took a beating on Wall Street last week, raising fears of the biggest financial crisis yet for the nation's battered housing market. That danger demands continuing short-term oversight by regulators to ensure the stability of these pivotal financial institutions and long-term reforms to reduce their influence. The companies' stock values plummeted after questions were raised about their financial stability.

Towson-based AmericasBank Corp. said yesterday that it has dismissed its president and chief executive officer, Mark H. Anders, in the wake of recent losses at the bank stemming from turmoil in the mortgage lending business. The company, parent of commercial bank AmericasBank, appointed A. Gary Rever as acting chief executive of the bank, which operates the Towson Community Bank in Towson and Annapolis Community Bank in Annapolis. Rever has served as AmericasBank's chief financial officer since August 2003.

There are uncountable culprits and dupes in the extraordinary chain of events that finished Bear Stearns, Wall Street's fifth-largest investment bank. But at its heart the crisis is a failure of regulation. If not for the Federal Reserve's and the Bush administration's refusal to stop crazy mortgage lending, former Bear boss James E. Cayne would still be chewing cigars in his Manhattan office, counting his money and complaining about regulators. And the country wouldn't be headed toward what might be the worst recession in decades.

WASHINGTON -- A presidential working group issued a broad set of proposals yesterday to correct weaknesses in the way homes are financed so that the problems now crippling the nation's housing sector won't recur. The President's Working Group on Financial Markets recommended changes in virtually every area of mortgage finance. It called for tougher state and federal regulation of mortgage lending and mortgage brokers. It also supported creating a national licensing standard for anyone who originates mortgages.

Maryland's employment market performed relatively well last month at a time of economic instability, bucking the national trend by adding jobs and cutting unemployment. The jobless rate fell to 3.7 percent, from 4 percent in July, the U.S. Labor Department said yesterday. That's significantly lower than the national rate, which remained at 4.6 percent last month. Employment grew last month by about 3,300 jobs, according to preliminary estimates adjusted for seasonal variations. Nationally, employers cut 4,000 jobs - the first drop in four years, when the country was still suffering from the effects of the 2001 recession.

Citing continuing restructuring costs and big losses from its mortgage lending business, General Motors Corp. reported yesterday a 90 percent plunge in first-quarter earnings. The company lost its long-standing place as the world's largest automaker during the quarter, as Japan's Toyota Motor Corp. edged past GM in global sales for the first time. The rough quarter was marked by continued but narrowing losses from GM's crucial North American automotive operations, as demand and production declined for its cars and trucks.

HUD reviving efforts to reform rules on mortgage lending Department of Housing and Urban Development Secretary Alphonso Jackson is reviving efforts to reform mortgage-lending rules to make loan costs more transparent. The agency plans to hold six meetings from July 14 to Aug. 18 seeking public and industry comments on reforms to a 30-year-old consumer-protection law known as Respa, the Real Estate Settlement and Procedures Act, Jackson said. Americans spend $55 billion on closing costs a year, according to a HUD statement.

Banks ease standards on mortgage lending for 1st time in 11 years Banks, faced with rising mortgage competition as home sales advance, have eased lending standards for the first time in 11 years. The Office of the Comptroller of the Currency's annual survey of underwriting surveyed the largest 71 institutions, whose $2.9 trillion of loans represent 90 percent of outstanding national bank loans. The agency's survey said banks remain sound, even as it urged lenders to be more cautious in lending in the future.

Three banks with a strong Maryland presence reported moderately to sharply higher first-quarter profits yesterday as the effects of major acquisitions and continued loan growth lifted revenue despite a drop-off in mortgage lending. Net income grew 37 percent to $159 million at M&T Bank Corp., which attributed much of the increase to its April 1, 2003, acquisition of Allfirst Financial Inc. Mercantile Bankshares Corp.'s profit increased 13.7 percent to $55.7 million, mostly a result of growth achieved through its purchase of F&M Bancorp of Frederick in August.