Fannie, Freddie, FHA under fire

Commentary: The uncertain future of mortgage lending

It has been a quiet week in the markets, shortened by Good Friday. Oh, Standard & Poor’s created a tempest with its threat to the AAA rating of Treasurys, but as the week wore on, more and more people asked, "How would they know?"

Stocks regained all losses, but Treasury bond yields stayed low, the 10-year at 3.39 percent and mortgages under 5 percent.

Bill Gross, famously dumping all of PIMCO’s Treasurys last month, has lost money on the trade. A federal budget deal is now likely; Europe is in trouble (again, Greek 2-year bonds paying 22 percent), and domestic data is weakening.

Sales of new and existing homes are flat, but distressed inventory is rising. The Federal Housing Finance Agency found that home prices fell 1 percent in January and another 1.6 percent in February.

The fascinating thing about housing, now: it’s no longer news. It’s so yesterday, boring. For seven months, media attention has focused on "Foreclosure Gate," the so-called robo-signing scandal in which some loan servicers allegedly foreclosed on some innocent homeowners.

The reality is clear now, as then: Some servicers have mistreated borrowers by inattention, finding a work-around for the antiquated local-level foreclosure procedures. Servicers will be fined and newly regulated.