Fay Servicing fined $5M for mortgage violations

Plus: Federal judge throws out ban on noncompetes

August 23, 2024

🏃‍♀️‍ You've crossed the finish line for this workweek. It's Friday — congrats! Today’s newsletter is 597 words, a 2-minute read.

Disclaimer: Average mortgage rates as of August 22, 2024. © MND Daily Rate Index.

1. Fay Servicing fined $5M for mortgage violations

The CFPB has ordered Fay Servicing, a Florida mortgage servicer, to pay $5 million for violating mortgage servicing laws and a 2017 order related to illegal foreclosure practices.

  • This includes a $2 million fine and $3 million in consumer redress.

The order also imposes limits on CEO Edward Fay's compensation if the company fails to comply with regulations. Fay Servicing disputes the claims but chose to settle to avoid lengthy litigation.

2. Average 30-year mortgage rate drops to a 2024 low

The average rate on a 30-year mortgage eased this week to the lowest level in 15 months, providing slight relief for home shoppers navigating a brutal housing market.

The rate fell to 6.46% from 6.49% last week, Freddie Mac said yesterday. A year ago, the rate averaged 7.23%. The average rate is now the lowest it's been since mid-May last year, when it was 6.39%.

“Earlier this month, rates plunged and are now lingering just under 6.5%, which has not been enough to motivate potential homebuyers,” Sam Khater, Freddie Mac’s chief economist, said in the statement. “We expect rates likely will need to decline another percentage point to generate buyer demand.”

🚨 Coach’s Corner

What the heck is ABU? I just learned this term and wanted to pass it along. Tune in! (Video)

— Dave Krichmar CEO

3. More Nuggets

📝 Fannie Mae and Freddie Mac update their private mortgage insurer eligibility requirements. (FHFA)

📉 Monthly mortgage payments decline for first time since 2020. (The Hill)

🏘️ Amazon accepting new pitches for multibillion-dollar housing fund. (BizJournals)

🧑‍⚖️ Homie sues NAR and others, alleging boycott and conspiracy. (Deseret)

💰 Law firms seek $36.8M out of $110M settlement pool in Gibson. (HousingWire)

4. Fannie Mae cuts home sales projections

Fannie Mae's Economic and Strategic Research (ESR) Group has downgraded its home sales forecasts for 2024 and 2025, despite recent declines in mortgage rates.

  • The new projections estimate 4.78 million home sales in 2024 and 5.19 million in 2025, down from previous forecasts of 4.81 million and 5.26 million, respectively.

The ESR Group noted that lower mortgage rates have not significantly boosted homebuyer activity due to persistent affordability challenges and high home prices.

A MESSAGE FROM US

📧 Effortless Email Marketing

Stop stressing over emails to your realtors and clients. We’ll craft high-impact, engaging emails for you—every week!

No commitment. Cancel anytime during your trial.

5. Federal judge throws out ban on noncompetes

A federal court in Texas has thrown out the government’s ban on noncompete agreements that was set to take effect September 4.

In her ruling, Judge Ada Brown of the U.S. District Court for the Northern District of Texas wrote that the federal agency had overstepped its power when it approved the ban.

"The FTC lacks substantive rulemaking authority with respect to unfair methods of competition," she wrote. "The role of an administrative agency is to do as told by Congress, not to do what the agency think[s] it should do.”

☀️ You’re all caught up. See you on Monday!

🚀 Wanna help our newsletter grow? Forward it to a friend or colleague.

Would you like to receive a ready-to-send weekly marketing email for your realtors and/or clients? Start your 30-day free trial here.

Was this email forwarded to you? Subscribe here.

Interested in advertising to 40k+ loan officers? Get in touch.