March 23, 2017
Latest from Inside Mortgage Finance
Total mortgage servicing outstanding rose by 0.7 percent from the previous month according to estimates from Inside Mortgage Finance
New originations of home-equity loans were up 8.0 percent in 2016 from the previous year, but the market peaked early and ended with consecutive quarterly declines in production, according to a new Inside Mortgage Finance ranking and analysis. Lenders originated an estimated $197.6 billion of home-equity lines of credit and closed-end second mortgages last year. It was the strongest output since 2008, but it was not enough to offset the years-long erosion of second-mortgage debt. At the end of 2016, the supply of outstanding home-equity loans fell...[Includes three data tables]
The Trump administration late last week filed its amicus brief with the U.S. Court of Appeals for the District of Columbia Circuit in PHH Corp. v. Consumer Financial Protection Bureau, and, as expected, sided with the lender this time around, but didn’t go as far as some had hoped it would. In its brief, the Department of Justice argued in support of eliminating the removal-only-for-cause protection that currently applies to the director of the CFPB. However, whereas PHH has argued that the CFPB be eliminated in its entirety, the Trump administration argued in favor of retaining the CFPB, but with a director removable at the will of the president. Currently, the director may be removed...
Although 2017 is expected to be a down year for originations, Freedom Mortgage – already a top-10 ranked lender – is poised for growth via mergers and acquisitions and is pondering deals for both servicing rights and other shops. Company CEO and founder Stanley Middleman told Inside Mortgage Finance bluntly: “We’re shopping.” Although Middleman declined to name any targets, he said...
Latest Mortgage Data
- FHLBank 4Q Advances Up 4 Percent, Led By Chase
- Retail Channel Dominated Agency Lending in 2016
- MBS & ABS Issuance at a Glance
- HECM Originations Down in 2016, December Spike Slowed Descent
- Bank Holdings of First Liens Increase in 4Q16
- CFPB Exams of Nonbank Mortgage Originators Jumped Last Year
- More Latest Data
Mortgage lenders that sell loans to Fannie Mae and Freddie Mac saw a huge drop in the volume of repurchases and other indemnifications in 2016, according to a new Inside The GSEs analysis of disclosure reports filed with the Securities and Exchange Commission. During the fourth quarter of 2016, lenders repurchased just $207.31 million of home loans, a 37.0 percent decline from the third quarter. That brought total repurchases to $1.101 billion last year, down 35.9 percent from 2015. Those are record lows in the contentious recent history of GSE buyback demands. Fannie and Freddie, along with other “asset securitizers,” began filing quarterly repurchase reports with the SEC in early...
A proposal from a former high-ranking official at S&P Global Ratings to reduce incentives for rating shopping has been met with skepticism and resistance from officials at other rating services. Howard Esaki, the former global head of securitization research at S&P Global Ratings, and Lawrence White, a professor of economics, NYU Stern School of Business, recently published a proposal to reform the process for how rating services are selected to grade MBS and ABS. They said...
Publicly traded mortgage-banking firms had a rough ride in 2016, which turned out to be a turning point for one of the sector’s stalwarts, PHH Mortgage. The nine publicly traded mortgage lenders tracked by Inside Mortgage Trends posted a combined $563.8 million in net income on their mortgage-banking operations during the fourth quarter. That was up sharply from the third quarter, but it was not enough to offset huge combined losses during the first half of ... [Includes one data chart]
The retail channel remains the predominant source of jumbo originations, according to an Inside Nonconforming Markets analysis of survey responses collected by Inside Mortgage Finance. Among the top jumbo lenders, more than four out of five jumbos originated during the fourth quarter of 2016 were through the retail channel. The 81.6 percent retail share of jumbo originations was up from a 79.3 percent share in the fourth quarter of 2015 ... [Includes one data chart]
Solicitation of VA purchase loans for streamline refinancing within weeks of closing is apparently continuing despite Ginnie Mae’s efforts to stop the harmful practice. The Mortgage Bankers Association has expressed concern that guidance on pooling eligibility for streamlined refinance loans, which Ginnie issued in October last year, was far less effective than expected. Although the aggressive refinancing trend has slowed due to Ginnie’s action, there are still “pockets of that activity” being reported, said Pete Mills, MBA senior vice president. Refinancing a veteran’s purchase mortgage less than six months after its origination is not in the vet’s best interest because it strips equity from the house and results in higher financing costs, said Mills. While the rapid refi trend involves only a small number of loans in Ginnie mortgage-backed securities pools, investors do not get the full benefit of their investment because of early prepayment. Mills said there are a handful of lenders and brokers that ...
The Trump administration has subtly signaled its support for PHH Corp. in the mortgage lender’s long-running dispute with the CFPB over alleged violations of the Real Estate Settlement Procedures Act. In recent days, the Department of Justice asked the U.S. Court of Appeals for the District of Columbia Circuit for permission to file an amicus brief in the case by March 17, one week after the deadline the court had given PHH to file its response to the court’s decision to grant the CFPB’s request for an en banc rehearing. The court has since granted the administration’s request for the one-week extension. In its request, the Justice Department said, “As this court recognized in calling for the views of the ...
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