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Real estate investors own almost 900,000 vacant properties nationwide, a share greater than the number of empty homes across the rest of the housing market, Attom reports. The vacancy rate nationwide is steady in the third quarter compared to past years, according to the property analytics firm's latest study. The number of homes that have been abandoned during the foreclosure process, referred to as "zombie foreclosures," meanwhile ticked up compared to the second quarter and year-ago periods. "While there remain some markets with worryingly high rates of vacancies, as a whole it appears that the nation's buyers are quickly filling homes that become available," said Rob Barber, CEO of Attom, in a press release. Once-tight inventory is loosening up nationwide, although home buyers still face steep affordability hurdles. In all, there are 1,385,901 empty residential properties across the country, or 1.3% of all homes, Attom said. Among the 24.9 million dwellings owned by investors, 882,336, or 3.6% of them are vacant. Midwestern states had the largest shares of empty investor-owned homes, led by Indiana with 7.2%, while rural states had the least amount, with just 0.9% of such properties in New Hampshire. Investors who devoured larger shares of home purchases during the refinance boom remain optimistic about their prospects despite current economic uncertainty. They're still feeling some strain, including realizing smaller profits on fix-and-flip projects. Zombie properties inch up but remain minisculeOf the over 222,000 properties currently in a foreclosure process, 3.38%, or 7,519 are unoccupied. The rate is up slightly from the second quarter, and greater than the 3.14% of zombie properties last fall, according to Attom. Smaller Midwestern cities had the largest shares of zombie properties, led by Wichita, Kansas where 12.7% of homes facing foreclosure have been abandoned. Other midsized cities across the nation touted ultra-low rates of empty, foreclosed homes, including zero in Nashville, Tennessee. Most states where zombie properties grew the most annually still had under 100 such homes statewide.The zip code with the highest zombie foreclosure rate was 91001 in Los Angeles, where 80% of homes have been abandoned. That area includes a large portion of Altadena, where the Eaton Fire in January razed numerous city blocks. A foreclosure moratorium for certain government-backed loans in that area expired in July. 

The Community Home Lenders of America is calling for nonbank lender support as it emphasizes the importance of mortgage industry input in any federal decision-making regarding the future of Fannie Mae and Freddie Mac. The group representing small and mid-sized independent mortgage banks made its wishes known in a letter this week to Treasury Secretary Scott Bessent and Federal Housing Finance Agency Director Bill Pulte, whose office oversees both government-sponsored enterprises. CHLA came up with suggestions it said best protected IMBs, particularly smaller lenders, and invited nonbanks to add their names to the letter. "We write as independent mortgage banks  — nonbank mortgage loan originators — to identify essential elements of a Fannie Mae and Freddie Mac exit from conservatorship," the letter began. "We do so in the wake of reports that the Trump Administration plans a public offering of these two entities later this year."Five recommendations from CHLACHLA listed key policies it said ought to remain in place in recommendations to the Trump administration for carving any future path out of conservatorship for the GSEs, highlighting the effectiveness of the status quo in some instances. Notably, it pushed back against consolidation. Recent talk surrounding the GSEs have moved beyond just a conservatorship exit or public listings to suggestions of a possible merger. "Fannie and Freddie should not be combined into a market monopoly. Further, the GSEs should operate under a utility model," CHLA underscored.  The group also said Fannie Mae and Freddie Mac must retain "critical" mortgage loan products that support its mission to provide affordable homeownership opportunities across class and communities. Lower revenue potential of such loans could lead the GSEs to discontinue offering them altogether, CHLA said.As the Federal Reserve's pullback from purchases of mortgage-backed securities has helped fuel higher interest rates, CHLA called for a post-conservatorship model that would have Fannie Mae and Freddie Mac make "temporary, opportunistic" MBS purchases to drive housing costs lower. In a push against any favoritism toward large banks that might emerge, CHLA also explicitly came out against awarding any GSE charters to Wall Street, saying "competition should be at the mortgage origination level — and not at the level where a GSE guarantee is granted to a handful of megalenders"Nor should preferential treatment be given through mechanisms like up-front risk sharing or granting a few megalenders access to the Common Securitization platform," the letter said. Earlier this summer, Pulte renamed the joint-venture secondary trading platform operated by the GSEs from Common Securitization Solutions to U.S. Financial Technology. Furthermore, CHLA pointed to what it considered successful outcomes from decisions made during President Trump's first term and underscored the value of keeping related policies in place, including guarantee-fee parity among lenders and a competitive cash window. In 2020, CHLA led an initiative to turn an informal g-fee parity policy into a permanent requirement and pushed to keep such terms in place.The GSEs' exit from conservatorship exit could create a business environment leading to a return to practices favoring large lenders, it argued. "G-fee parity precludes one of the most pernicious pre-2008 housing crisis practices  — preferential pricing for large, reckless lenders," the letter stated. "A robust competitive cash window ensures that Fannie and Freddie purchase all qualified single-family loans from all approved seller-servicers, at rates that are competitive with lender securitizations."Potential hurdles to GSE changesWhile Director Pulte and President Trump have made strong public hints on social media and broadcast interviews of the changes they want to see, any of their suggested moves will receive heightened scrutiny for the effects on the housing market and the long-established mission of GSEs to provide liquidity for affordable homeownership. "The mission of a for-profit company is to fulfill the wants and needs of its shareholders through the board of directors. The mission of a government-sponsored enterprise is to comply with its mission. These are incredibly different things," said Mike Peretz, executive director of banking and payments at technology and management consultancy firm Capco. With private markets unlikely to prioritize today's home affordability challenges, "you need the GSEs more than ever," he added. Earlier this week Pulte posted a video spotlighting the proposed Great American Mortgage Corp. touted by the president, with the entity's banner strategically placed beneath logos of both Fannie Mae and Freddie Mac.  A merger of the GSEs would likely raise antitrust concerns, though, and many experts also see potential legal and political questions behind combining the two enterprises that have no clear answers yet.  "The complete lack of information on a major policy change/initiative introduces new unquantifiable risks for Fannie and Freddie, in our view," wrote Ed Groshans, senior policy and research analyst at Compass Point in a recent research note. "Our assessment is the risks cannot be analyzed or addressed until more information is provided by the Trump administration."

Lagging tech adoption and credit underwriting issues were likely contributors to loan quality worsening from a recent record-low rate, according to Aces Quality Management. The overall critical defect rate rose to 1.31% in the first quarter, shifting away from the fourth quarter's historical low of 1.16%, the company's latest report found. Defects rose in three of four underwriting categories, and more errors cropped up in refinances despite a drop in volume. "The modest rate pullback during the quarter did not produce corresponding quality improvements in [quality control] outcomes," the report stated.  Income and employment defects were the most cited errors, rising over 42% from the fourth quarter and making up 23% of all issues. Documentation-related issues rose while calculation and eligibility-related defects waned, according to Aces. The report speculated that the shift may reflect lagging adoption of tools such as Freddie Mac's Loan Product Advisor Choice and Fannie Mae's self-employment income calculator. Credit issues in underwriting also rose slightly and made up 12% of all critical defects in the first three months of the year. Documentation-related errors were again the culprit, as lenders may be struggling with missing or outdated credit reports, Aces said. The rising cost of credit reports could also be a factor, as lenders may be reducing the number of pulls per file. "Those strategies may lower upfront costs, but can lead to downstream quality issues if they result in incomplete or inaccurate documentation in the final loan file," the report said. Lenders today are making more money on each loan originated but are reckoning with, and arguing against the rising cost of credit reports. The defects from the first quarter were identified using Fannie Mae's defect taxonomy, or rather any aspect that makes a loan uninsurable or ineligible for sale. The errors don't necessarily represent instances of fraud, and a separate second quarter analysis found the share of loans with issues indicating fraud declining. Lender improvement in other underwriting areasOriginators also struggled to contain eligibility errors, which quadrupled from the end of 2024 to account for nearly 7% of all defects, Aces reported. Those issues regarded calculations of debt-to-income and loan-to-value ratios and determining product eligibility. Other underwriting fields however saw improvements, according to the study. Those include:Assets, making up a smaller 11.49% of critical defects because of broader adoption of automated verification methods; Legal, regulatory and compliance, accounting for 14.94% of errors as lenders corrected defects from past quarters; Appraisal, falling to 2.30% of all defects because of stability in valuation practices. How defects shifted for different products and purposesOnly loans backed by the U.S. Department of Agriculture recorded a declining defect rate, despite an increase in volume. Errors in Federal Housing Administration-backed mortgages remained relatively flat, Aces said, while issues in conventional and Department of Veterans Affairs-backed loans ticked up.  The share of defects in purchase loans fell to start the year, despite an increase in volume. Higher interest rates to start the year kept refi demand muted, but errors in those transactions rose, Aces said. The pattern could be explained by lenders pushing to close refi deals in late 2024 and repricing some at higher rates in the first quarter. "The resulting time pressure may have contributed to an uptick in defects, particularly in documentation-heavy areas," the report said. 

A public offering of Fannie Mae and Freddie Mac shares hinges on when Donald Trump decides the government can fetch the highest price, their regulator said Thursday.Trump "has not made any decision" on when one will occur, Bill Pulte told Maria Bartiromo on  Fox Business Network Thursday morning, when she asked whether one could happen near term given Trump's recent post depicting an offering for the Great American Mortgage Corporation in November.Trump has long been watching for the right timing for a Fannie-Freddie IPO since his first term, according to Pulte, who has rebranded FHFA as U.S. Federal Housing."He got approached to sell these companies for about $100 billion, if you can believe that, $150 billion today. That value is anywhere from $500 billion to $700 billion. I think it's going to $1 trillion, and potentially even higher," said Pulte, director of the Federal Housing Finance Agency.The $500 billion-plus range is in line with a recent Bloomberg report citing Trump administration thoughts on valuation sought. Based on the information at hand at the time of Trump's post, Keefe, Bruyette & Woods analysts had pegged the value as closer to half that amount."Everybody wanted to steal this company from the American taxpayers and President Trump deserves great credit for saying, 'No thank you, we are going to do what's in the best interest of people,'" Pulte added in his Fox interview Thursday.Pulte pointed to Fannie and Freddie's combined $7.8 trillion in assets and what he views as strong international demand for their shares, saying both factors could drive an "oversubscribed" offering.Interest rates and related policy could be a factorComments later in the interview suggest Federal Reserve Chairman Powell's reluctance to raise interest rates, which both Trump and Pulte have been critical of, could be a consideration in getting maximum value for Fannie and Freddie in the market.Low rates can be a mixed blessing for the mortgage industry and the GSEs. They can, for example, increase the enterprises' loan acquisitions and guarantee fee income but they also may reduce future opportunities to refinance and create new loans.Pulte said the fed funds rate should be "zero or 1% at the highest" as opposed to above 4%. Trump administration officials have signaled little interest in pursuing Fannie and Freddie reforms that could push mortgage rates higher.Powell, an independent policymaker speaking at the Jackson Hole Economic Symposium this week, has been cautious about lowering the fed funds rate, citing concern it could exacerbate inflation in prices for many items consumers buy, including shelter.He also has said his role with respect to housing is limited given most mortgages are pegged to how longer-term bonds trade than the short-term rates the Fed controls.Pulte has taken issue with that stance given that Fed policy and its outlook still can exert considerable influence on mortgage rates. He told Bartiromo on Thursday there could be "damage to the housing market up to two years after he's gone" in reference to Powell.How a public offering would be structured still undeterminedAs far as what form a public offering could take, Pulte said that GSE reform is a priority for Trump, the housing regulator also said there hasn't been a call yet on what or if anything will be done."President Trump has exercised great judgment and he'll exercise, in my view, that same judgment in deciding whether or not to do something with Fannie and Freddie," Pulte said.

Real estate investment trust Two settled its long-running litigation with its former external manager Pine River for a one-time payment of $375 million.The dispute escalated in July 2020, when Pine River and affiliated entities dismissed a state court legal filing and instead pursued the case in federal court.At the same time, Two, the business name of Two Harbors Investment, accelerated its termination of the management agreement from the original expiration date in September of that year to Aug. 14. Two claimed it was removing Pine River for cause and thus did not have to pay a termination fee.The Pine River suit also accused Two of attempting to appropriate its intellectual property.On May 23, following the recommendations of a magistrate judge, the federal court ruled in favor of Pine River that Two did not have a basis to terminate the management agreement; all other requests for summary judgement on both sides were dismissed.At the time, Two took a $198.9 million contingency litigation expense, inclusive of a $139.8 million termination fee it believed it would owe Pine River. The charge impacted Two's second quarter results.The settlement addresses both points. The one-time cash payment to Pine River is due 30 days after the settlement agreement was signed, which was on Aug. 20.Two plans to use cash on hand as well as draw from its available borrowing capacity.The agreement also calls for Pine River to relinquish all ownership claims to any intellectual property involved."The resolution of this matter is an important development for our company that allows us to move forward with clarity and certainty of purpose," said Bill Greenberg, Two's president and CEO.Taking the settlement agreement into account, Two's common stock book value falls to $11.06 per share from $12.73 per share."We estimate that the decline in book value should result in pro forma leverage of approximately 7.8 times, which is well above the recent average of closer to 6.5 times, so we would assume some level of balance sheet reduction," a post-settlement report from Bose George of Keefe, Bruyette & Woods, said.In addition to announcing the settlement, Two, the parent of Roundpoint, said it sold $20 billion of mortgage servicing rights to an undisclosed buyer; the price was also not released. But it retained the servicing function on those MSRs, bringing Roundpoint's subservicing business to handling $31 billion of unpaid principal balance or approximately 138,000 loans.The MSR sale should support Two's liquidity and reduce its leverage, George said."The carrying [value] of the company's MSR was 5.9 times the 25.4 basis point servicing fee, suggesting a carrying value of approximately 1.5%," George said. "Assuming the same multiple on the sold MSR, the company should have generated roughly $300 million of cash (before netting out any asset-level financing)."

Mortgage rates were unchanged as the markets await what Federal Reserve Chairman Jerome Powell will say on Friday.At the same time, a 10-basis point rise in the 10-year Treasury between Aug. 13 and Aug 18 was partially reversed by two days later in anticipation of a speech possibly hinting at September Fed Funds Rate reduction.The 30-year fixed rate mortgage remained at 6.58% for the week of Aug. 21, according to the Freddie Mac Primary Mortgage Market Survey. For the same time last year, the 30-year FRM was at 6.46%. "Over the summer, rates have come down and purchase applications are outpacing 2024, though a number of homebuyers continue waiting on the sideline for rates to further decrease," said Sam Khater, Freddie Mac chief economist, in a press release.Meanwhile, the 15-year FRM dropped 2 basis points week-to-week to 5.69%. This compares with 5.62% one year ago at this time."Mortgage rates show signs of easing below 6.5% as conviction strengthens for the Fed to cut rates in September, at the same time the 10-year [Treasury] has struggled to drop below 4.25% on decisively mixed inflation data," Eric Hagen of BTIG wrote in an Aug. 21 commentary which came out before the Freddie Mac data."We think originator profit margins have only some room to drop further to support lower mortgage rates, which clouds the outlook for primary mortgage rates to fall meaningfully below 6% absent the 10-year also crossing below 4%."At noon on Thursday, the 10-year Treasury yield was at 4.34%, up from Wednesday's close at 4.3%. But after Aug. 14, when the yield closed at 4.24%, it pushed up to 4.34% at the close on Aug. 18.Hagen noted the mortgage to Treasury spread remains in the area of 250 basis points versus the norm of 175-to-200 basis points. Primary and secondary market spreads also have room to tighten."But aside from seeing a more material drop in the 10-year, envisioning mortgage rates getting down into the mid-5's over the medium/longer-term may be most likely driven by the super-scaled originators bringing down origination costs through the application of technology," Hagen said.Zillow's rate tracker reported the 30-year FRM rose 6 basis points from last week's average to 6.73% as of 11 a.m. on Thursday.Lender Price data on the National Mortgage News website showed the 30-year FRM at 6.58% at the same time, versus 6.57% one week earlier.Going forward, the next market moving event will be tomorrow's speech by Powell at the symposium in Jackson Hole, Wyoming, said Kara Ng, Zillow Home Loans senior economist. Notwithstanding what happened this week, mortgage rates had been trending lower as of late, she noted in her commentary."With markets already pricing in strong odds of a September rate cut, any hint from Powell that the Fed is not ready to ease policy could spark a reversal in mortgage rates," Ng said.The Mortgage Bankers Association's Weekly Application Survey for the period ended Aug. 15 found the conforming 30-year FRM 1 basis point higher at 6.68%.Purchase applications were virtually flat with the previous week on a seasonally adjusted basis. Unadjusted they were down 2% from the previous week but up 23% from one year ago.Volume for purchase loans was at its strongest pace in four weeks, Bob Broeksmit, MBA president and CEO said in a Thursday morning commentary."Housing affordability remains a challenge for many prospective homebuyers, but demand continues to be stronger than last year," Broeksmit said.Existing home sales grew 2% month-over-month and by 0.8% versus the previous year according to data released Thursday morning by the National Association of Realtors.Still, "Unless mortgage rates move lower and stay there, the housing market will remain slow and regionally uneven, with locked-in sellers and rising inventory limiting both appreciation and the pace of home sales," said Ruben Gonzalez, the chief economist at Keller Williams.While mortgage rates are lower than their recent peaks, it doesn't offer much relief to buyers, Gonzalez said. "Sellers are increasingly locked in not only by their low mortgage rates but also by their declining equity positions."On the other hand, "If mortgage rates continue to trend down in the coming months, building inventory may offer buyers more leverage and choice," Gonzalez said.

Mr. Cooper can finish what Homepoint started and seek damages from a small lender over a repurchase request, a federal judge has ruled.The massive lender and servicer which purchased Home Point Financial in August 2023 did not indicate in court filings nor a statement whether it would pursue the lingering case against Pennsylvania-based Amres Corp. Homepoint, as other lenders have done, sued eight correspondent partners for failing to repurchase loans totaling $4.6 million. Most of those cases settled for undisclosed terms, according to a National Mortgage News review of federal court records. Some of those agreements came long after Mr. Cooper completed its nine-figure acquisition of the lender that blossomed and withered over the course of the refinance boom.The Amres complaint focused on a Freddie Mac repurchase request in 2022, involving a $500,000 loan at a Florida condominium hotel which was mired in a lawsuit over alleged construction defects. Both of those factors violated Freddie Mac guidelines, court filings stated.Homepoint said it was forced to repurchase the loan, and argued that Amres failed to cure the issue in violation of a correspondent agreement it signed in 2018. Counsel for Homepoint claims Amres in 2023 also reneged on an agreed-upon $80,000 settlement. Amres in January filed a motion to dismiss the lawsuit, arguing Homepoint lacked standing because it ceased to exist. U.S. District Court Judge Robert White denied that motion last week and found Homepoint, or Mr. Cooper as successor-in-interest, had standing to sue."Ultimately, when Mr. Cooper absorbed Homepoint, Homepoint's claim became another asset, like Homepoint's loans or its office buildings," wrote White. Amres recorded $185 million in loan origination volume last year and over $500 million in 2022 when the loan in question was made, according to Home Mortgage Disclosure Act data. A spokesperson and attorney for Mr. Cooper declined to comment this week, while an attorney and executive for Amres didn't reply to requests for comment. Homepoint closed out correspondent disputes amid shutdownThe former wholesale and correspondent shop reached settlements with six correspondent partners it accused of failing to repurchase loans. Those cases were: AHL Funding, over two loans totaling $751,999, dismissed in MayContinental Mortgage Bankers, over one loan for $663,984, dismissed in 2024Fidelity Direct, over one loan for $297,069, dismissed in December 2023Lending 3, over two loans totaling $523,630, dismissed in July 2023Loan Factory, over one loan for $248,872.12, dismissed in August 2023Patriot Lending, over one loan for $218,991.75, dismissed in October 2023A federal court in 2023 also granted Homepoint default judgment in a case against Trans United Financial Services for three loans totaling $1.6 million. The court also allowed Homepoint to garnish funds from the lender's Wells Fargo bank account. Nationwide Multistate Licensing System records indicate the Tustin, California-based Trans United stopped originating loans in 2023. Mr. Cooper paid $324 million for Homepoint in May 2023, a month after the company sold its wholesale business to The Loan Store. Home Point Capital, the lender's parent company, was founded in 2014 and made its Wall Street debut in 2021 with huge production numbers. The company was one of several to go out of business when interest rates began their climb in 2022 and 2023. Although it generated almost $900 million in loan volume in the first three months of 2023, the company posted a $133.8 million net loss in that final quarter as a public company.Mr. Cooper meanwhile has posted large profits in recent quarters and is awaiting the closing of a massive acquisition by Rocket Cos. 

President Donald Trump and his allies are demanding Federal Reserve Governor Lisa Cook resign over alleged owner-occupancy fraud — a practice the central bank itself has found to be "broad-based" across the US.Philadelphia Fed researchers in a 2023 report assessed the number of "fraudulent investors" in the mortgage market, which they defined as those who had more than one owner-occupied home purchase loan within four quarters after the first one was originated. READ MORE: Trump calls on Fed's Cook to quit over mortgage probeFederal Housing Finance Agency Director Bill Pulte has said that Cook took a mortgage on a property in Ann Arbor, Michigan, stipulating that it would be her primary residence, and then two weeks later declared the same for another mortgage on a Georgia property.The paper's data set consists of 584,499 loans made from 2005 to 2017. Of those, 22,431 were considered fraudulent. The share of those claiming occupancy for better mortgage terms peaked ahead of the 2008 financial crisis, though remained steady for much of the ensuing decade at about 2% to 3%. The findings are based on a subsample of data, meaning the number of mortgages fitting the central bank's criteria could be higher. The researchers also caution that there are likely cases of accidental occupancy fraud, such as when borrowers were unable to sell their original home because of a worse-than-expected real estate market.Ronel Elul, a senior economic adviser and economist at the Philadelphia Fed who co-authored the 2023 report, didn't elaborate beyond what was in the paper when reached for comment. The Fed declined to comment, while Cook didn't reply to requests for comment.David Joffe, a federal criminal defense attorney in Fort Lauderdale, Florida, said in his experience, occupancy cases are rare.Still, "like anything else, if you look at it under a microscope you're bound to find something that's wrong," he said in an interview.The report found that about a third of all property investors misrepresent their status as owner-occupants. It found that doing so allowed them to obtain lower interest rates and higher loan-to-value ratios."This type of fraud is difficult to detect until long after the mortgage has been originated," the Philadelphia Fed researchers said in their paper.Cook's mortgages in question were from 2021. Trump's administration has also made mortgage fraud allegations against California Senator Adam Schiff and New York Attorney General Letitia James. Both are Democrats and political foes of Trump. 

President Trump is demanding the resignation of Federal Reserve Governor Lisa Cook after his housing chief accused her of lying on mortgage applications. The allegations, if true, could force a shake-up at the central bank and hand Trump another appointment."Cook must resign, now!!!" Trump wrote in a Truth Social post Wednesday, including a link to a Bloomberg article about the accusations.Federal Housing Finance Agency Director Bill Pulte shared on X earlier in the day a screenshot of a criminal referral to the Department of Justice regarding Cook's alleged conduct. The head of Fannie Mae and Freddie Mac's oversight agency says Cook falsely claimed two different mortgaged homes as her primary residence to secure a better rate on an Atlanta property, which she allegedly rented out.Cook was nominated to the Fed by former president Joe Biden in 2022. Her term expires in 2038. Cook voted to maintain the federal funds rate in the latest Federal Open Market Committee meeting, and has not voted against the majority in rate decisions since she began her term, according to FOMC meeting statements. Pulte has long-criticized Federal Reserve Chairman Jerome Powell and the FOMC for not lowering the federal funds rate, which can but does not always lead to lower mortgage costs and greater origination activity. In a lengthy phone call with CNBC Tuesday, Pulte suggested Cook would have to resign or be fired, but also denied the accusation was political. "I say these things about Powell needing to resign and everything on the political side, this is very different," he said. A spokesperson for the Federal Reserve said it did not have an immediate comment on the matter.The director of the agency now called U.S. Federal Housing said his office makes mortgage fraud referrals on a daily basis and does not consider politics, wealth or profession—a remark seemingly aimed at New York Attorney General Letitia James, whom Pulte has also accused of fraud."I don't understand how she can be in charge of setting interest rates for our country and here she is potentially lying on her applications to get better interest rates," he said of Cook.  Pulte's latest accusation drew some ire Tuesday over its alleged political subtext. Aaron Klein, senior fellow at Brookings Institute, noted Trump has been found guilty himself for lying about loans, a reference to James' victory in a civil fraud case against the then-former president in 2023."One [should ask the] question whether Pulte is running the same standards for everybody," said Klein. What is the alleged mortgage fraud?Unlike mortgage fraud accusations made against Trump foes like James and Sen. Adam Schiff, D-Calif., Pulte publicly shared more details of the criminal referral he sent to the Department of Justice. He told CNBC his office had received a tip about her conduct. Cook acquired a 15-year loan with the University of Michigan Credit Union for $203,000 plus interest, for an Ann Arbor, Michigan property. Two weeks later she purchased a $540,000 Atlanta condominium, with a mortgage from Bank Fund Staff Federal Credit Union. The FHFA alleges she represented in both applications that the properties would be her primary dwellings.The letter cites "online records" showing the Atlanta condo was listed for rent in September 2022. Pulte posted to social media Tuesday a screenshot of the unit's listing history, which matches a Zillow profile for the property. Cook's financial disclosures for 2022 and 2023 also allegedly don't show any rental income tied to her address. Pulte referred Cook under four criminal statutes, according to Bloomberg. Pulte also told CNBC his office is probing an additional Cook property in Massachusetts, but no wrongdoing has yet emerged. The DOJ has not said publicly whether it would investigate the claim. Should Cook depart the Fed, President Trump could appoint a replacement; he's already set to replace ex-Fed gov. Adriana Kugler who stepped down this month. Pulte's mortgage fraud initiativeThe director has placed major emphasis on pursuing fraud since he took office in March, and has said the FHFA's new tip line is very active. He also told CNBC he fired GSE board members at the beginning of his tenure because the incoming administration discovered numerous instances of multifamily fraud. In July Pulte confirmed a Trump post that Fannie Mae's Financial Crimes Division found Schiff engaged in mortgage fraud, regarding the California lawmaker's "primary residence" near Washington, D.C. New York state's top cop James meanwhile was reportedly facing a federal grand jury investigation in May regarding mortgages in the Empire State and in Virginia. As of Tuesday, neither official had been indicted on criminal charges. The accusations against Cook came after Pulte posted a video earlier in the week promoting the Great American Mortgage Corporation, the entity Trump hinted could make its Wall Street debut this November. Pulte tied his fraud campaign Tuesday to that initiative, telling CNBC it was in the GSE's business interest to root out misconduct. "Frankly, we talk about this potential IPO, or potentially selling shares one day, we need to make sure we have strong and sound businesses if and when we go to do that," he said.Maria Volkova contributed to this report.

The American Land Title Association has created two title insurance policy endorsements addressing the issue of seller-impersonation fraud.These endorsements will allow title insurers to cover any potential legal costs to correct public records if forged deeds or mortgages are recorded.The organization provides base policy title insurance forms, endorsements, closing protection letters and other documents which are standard for the industry. Borrowers must provide some form of coverage for the lender. A borrower policy is typically bundled with the lender coverage but is not required by the secondary market.Iowa is the exception, where a state-run system is in place; however, Iowa Title Guaranty uses ALTA forms.How big of a problem is seller impersonation fraudAn October 2023 survey from Certifid, which offers wire fraud protection services, found 54% of real estate professionals experienced at least one seller-impersonation fraud attempt within the prior six months. Over three-quarters of the respondents, 77%, said they noticed an increase in such attempts over the same time frame.In May 2024, ALTA conducted its own online survey which found 28% of title insurance companies experienced at least one seller impersonation fraud attempt in the past year; 19% reported an attempt in April 2024 alone.ALTA cited Internet Crime Complaint Center data, which found cyber-enabled crime and fraud resulted in losses of $174 million to the real estate sector last year. The average claim for a title insurer was over $143,000.The added protections provided by the ALTA endorsements is a step in the right direction, said Ryan Marshall, CEO of fraud prevention and data security firm Equityprotect. But how will title insurers implement these changes in a way which creates real impact?"For example, will the major underwriters reach out to past clients and property owners? Will they review title chains to confirm that the policies tied to new endorsements remain enforceable? And most importantly, what will the cost structure look like?" said Marshall.Equityprotect will continue to recommend that homeowners pursue expanded title insurance policies for all of their future and prospective property purchases wherever such coverage is available, Marshall continued.What is common in seller-impersonation fraudThese fraud attempts had common characteristics such as notarization issues and the use of the property owner's non-public personal information.Red flags involve vacant land transactions, requests for use of an unknown notary and all-cash transactions, the ALTA report said."With criminals harnessing advanced technology to perpetuate sophisticated seller-impersonation schemes against unsuspecting homeowners, new products like the policy endorsements are needed to keep the American dream of homeownership intact," ALTA CEO Chris Morton said in a press release. "These endorsements set the standards for forgery protection before and after closing and build upon ALTA's landmark Homeowner's Policy of Title Insurance."How ALTA changes its best practicesIn addition, ALTA updated its best practices to give title agents better guidance in this area. These best practices, also known as the seven pillars, came out in the early 2010s in response to a Consumer Financial Protection Bureau statement holding originators accountable for the actions of their vendors. With the update, the current framework is version 4.2.With the update, the organization is proposing new standards for identity-verification during real estate closings. These include specialized staff training to detect impersonation attempts, stronger controls over notary and signing-agent selection, additional verification steps for third-party professionals and defined protocols for responding to suspected fraud.New York's first deed theft law indictmentsOn Aug. 7, New York Attorney General Letitia James announced the first indictments under the state's new deed theft law. Among the counts against the accused, Deepa Roy and Victor Quimis, are allegations that they forged a deed with the signature of the homeowner who was in hospice care at the time.Those actions allegedly turned ownership of the property to the accused, who then transferred it to a company owned by Quimis.The legitimate property owner's signature was reportedly notarized using a forged signature and incorrectly dated stamp from a Nassau County, New York, licensed notary. The perpetrators also applied the victim's forged signature on a number of other required real estate transfer documents, including a registration form for water and sewer billing from the New York City Department of Environmental Protection.To accomplish the second transfer, the notary's signature was again forged.Quimis was able to obtain a $552,500 mortgage; some of the proceeds were used to pay off the victim's home loan.