FBI investigating 14 companies for mortgage fraud
Complaints about potential mortgage fraud are up during the subprime mortgage crisis, and the FBI has opened criminal investigations of 14 companies related to subprime mortgage loans, the agency said Tuesday. Neil Power, chief of the FBI economic crimes unit, attributed the increase "to good old-fashioned greed." "On insider trading, we're looking in some cases at whether executives were aware that the value of their holdings would be going down and the executives traded on that information," said Power.

Steve Kroft Reports How The Mortgage Meltdown Is Shaking Markets Worldwide
It was another nervous week for the world's financial markets and for Wall Street. In the last six months, Americans have seen their investments shrink, their property values plummet, and the country edge closer towards a recession. At the heart of the problem is something called the subprime mortgage crisis, which began last summer and continues to ricochet through the economy...Developers started turning asparagus fields into subdivisions, and lenders handed out free money to anyone who wanted to buy. "What do you mean by free money?" Kroft asks Jim Grant, the editor of "Grant's Interest Rate Observer" and one the country's foremost experts on credit markets. "I mean free money. I mean you had to apply not to get a loan, almost. Sometimes you have to apply to get a loan, you almost had to apply not to get one," Grant says.

Congress reluctant to act on mortgage lending issues
As 2007 came to a close, Congress had done a lot of talking about cracking down on unfair and deceptive mortgage lending practices, but didn't deliver on any major legislation. Although there's some consensus that tighter regulations or new laws governing lenders are needed, some lawmakers have been reluctant to impose restrictions that might worsen the credit crunch and the housing downturn. In the meantime, the Federal Reserve has proposed strengthening its implementation of the Truth in Lending Act, through new regulations that would require subprime lenders to verify a borrower's ability to repay a loan after a payment reset; document income and assets; and establish escrow accounts for taxes and insurance for a minimum of one year.

Mortgage-Relief Plan Divides Neighbors
The state's highest number of foreclosures is in the Inland Empire, a region of 4.1 million people. The area might seem ripe for the mortgage-rescue plan, which would freeze interest rates for certain borrowers who have kept current on their loan payments but can't afford scheduled interest-rate increases over the next two years. The Inland Empire was a builder's delight in recent years as middle-class families increasingly were priced out of Los Angeles and Orange County. Giants such as Lennar Corp., KB Home and Beazer Homes USA Inc. uprooted citrus groves and paved over dairy farms to blanket the area with tract housing and upscale developments.

The Calabasas lender says California and Illinois have issued subpoenas
The nation's No. 1 mortgage lender, Countrywide Financial Corp., is under investigation by California Atty. Gen. Jerry Brown and the attorney general's office in Illinois, the Calabasas company said Thursday. The investigation in Illinois, which was first reported in the New York Times, grew out of a probe into broker One Source Mortgage, which the state has charged with luring borrowers into loans they couldn't afford.

Senate Democrats propose new restrictions on mortgage lenders
Senate Democrats have rolled out a bill that, like legislation passed by the House last month, is aimed at preventing mortgage brokers from steering borrowers into higher-cost loans in order to collect bigger fees, and bars prepayment penalties on subprime and high-cost loans.The Homeownership Preservation and Protection Act of 2007, introduced Wednesday by Sen. Chris Dodd, D-Conn., would require loan servicers to implement loss mitigation strategies before initiating foreclosure proceedings against borrowers.

Kick 'em when they're down
Unions representing hotel and textile workers have created a Web site advocating a boycott of Countrywide Financial Corp.'s banks and financial institutions. Countrywide's not doing enough to help out troubled borrowers, the unions claim, so consumers shouldn't let the lender use their savings to make more loans...If Countrywide can be accused of kicking borrowers while they're down, the same might be said of the boycott, depending on your point of view.

Outstanding Fox 4 Report:Mortgage Investments Story
A Becky Oliver Investgative story.  View video report Part I - View video Part II - Follow-up: Mortgage Investors React...  

House passes controversial anti-predatory-lending bill
The House of Representatives Thursday approved controversial legislation intended to combat predatory lending, amending some provisions to address criticism that the bill could worsen the credit crunch, but strengthening others. HR 3915, the Mortgage Reform and Anti-Predatory Lending Act of 2007, would create a national licensing system for mortgage loan originators and require lenders to determine that borrowers have a reasonable ability to repay a loan. The bill would also create limited liability for companies that bundle mortgages for sale to Wall Street investors.

Housing fraud alleged
...the developers and 10 other businesses used predatory lending, fraud and unfair business practices against Spanish-speaking homebuyers over the past two years...mortgage broker firms Universal Mortgage, IRA Mortgage and Creative Mortgage placed the plaintiffs in subprime loans instead of placing them in the best loans possible, then took undisclosed and excessive commissions from them...the plaintiffs are suing Countrywide Financial, New Century, Cameron Financial Group and Wells Fargo banks, saying they approved illegal and unfair business practices committed against the plaintiffs.