Mortgage Servicing Fees Become An Area of Concern

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Real Estate Agent with ERA Queen City Realty

Mortgage servicing fees become an area of concern in the wake of the mortgage meltdown. However, the concern is heighten subsequent to the Robo-Signing Scandal. Now with the spotlight squarely focused on the fee structure, the Federal Housing Finance Agency has given marching orders to Freddie Mac and Fannie Mae to work with the Department of Housing and Urban Development to come up with a proposal for a new fee structure and improved standards.

While there is keen interest in fee restructuring to better serve the current market, people like Shelia Blair of the Federal Deposit Insurance Corporation want standards implemented that would require lenders to keep some skin in the game for those loans that they sell or securitized. Mortgage servicing fees are very lucrative for managing  non-performing assets. Foreclosed properties have a greater revenue stream for mortgage servicers in comparison loans that are paid on time as agreed. In the wake of the meltdown, mortgage servicing fees become an area of concern, that has prompted a full review of regulation in this area. Ms. Blair's proposal would require lenders to continue to hold on to a portion of the liability after selling or securitizing, in the hopes of creating more accountability and better fiscal management.

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Emily Medvec Qualifying Broker
Hello Realty - Santa Fe, NM
Realtor | Serving Santa Fe & Northern NM

William, thank you for your post on what is happening to mortgage servicing and their fees. Given this new landscape of real estate, it is challenging to follow all the threads and the money.

Jan 18, 2011 08:16 PM #1
Rainmaker
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William Collins
ERA Queen City Realty - Scotch Plains, NJ
Property and Asset Management

Emily, thanks for stopping by. This landscape is a work in progress and before we see the final product, there will be untold changes and challenges. As Bette Davis once said  "Buckle up its going to be a bumpy ride."

Jan 18, 2011 08:30 PM #2
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Dan Edward Phillips
Dan Edward Phillips - Eureka, CA
Realtor and Broker/Owner

Good Morning William, thanks for posting the update on mortgage servicing, it will be a very interesting year.

Jan 18, 2011 09:59 PM #3
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Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Calabasas CA

I lost two escrows with first time buyers these year because of these fees. When buyer saw their points and fees( after the offers were accepted), they panicked, canceled and decided to continue their rental lives.

Dec 07, 2013 08:54 AM #4
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William Collins

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