October 27, 2016

Latest from Inside Mortgage Finance

Total agency MBS servicing rose by 3.9 percent from the previous quarter according to estimates from Inside Mortgage Finance

Subscribe to Inside Mortgage Finance.

Mortgage Originations Hit Estimated $580 Billion In 3Q16, Nonbanks Claim Over Half the Market

The U.S. mortgage market produced an estimated $580.0 billion of first-lien originations during the third quarter of 2016, according to a new Inside Mortgage Finance analysis and ranking. That was up 13.7 percent from the second quarter, and it marked the strongest origination cycle since the fourth quarter of 2012, when $584.0 billion of new loans flowed through the pipes. The robust third quarter brought year-to-date originations to $1.470 trillion, up 8.9 percent from the first nine months of 2015. Lender feedback and agency mortgage-backed securities data suggest...[Includes two data tables]


GSEs Push Verification Services, Expect More Focus on Affordable Housing Programs in 2017

Fannie Mae and Freddie Mac featured new technologies aimed at streamlining the loan production process and further limiting lender repurchase risk during this week’s annual convention of the Mortgage Bankers Association in Boston. Top officials of the two government-sponsored enterprises said that 2017 will bring further efforts to expand affordable housing opportunities, a theme underscored by their chief regulator. Melvin Watt, director of the Federal Housing Finance Agency, said...

Cordray Details TRID Exams

Consumer Financial Protection Bureau Director Richard Cordray said agency examiners are conducting “transaction testing” to assess compliance with new TRID disclosure rules. Looking at loan files is necessary to a diagnostic compliance assessment, he told a good-sized audience at this week’s annual convention of the Mortgage Bankers Association. The bureau chief repeated earlier assertions that TRID compliance reviews would be “diagnostic and corrective, not punitive.” Cordray said...

Feature Stories

Inside The GSEs

GSE MBS Servicing Grew Slightly in 3Q16, Nonbanks Increase Share

During the third quarter, total Fannie Mae and Freddie Mac servicing related to single-family mortgage-backed securities nudged slightly higher, according to a new Inside The GSEs analysis and ranking. The two GSEs had a combined $4.5 trillion in single-family MBS outstanding at the end of September. That was up 0.4 percent from the previous quarter, but down 0.4 percent from a year ago. Total GSE single-family servicing is somewhat higher because both Fannie and Freddie have retained portfolios of unsecuritized mortgages. Fannie MBS servicing was actually down 0.2 percent during the third quarter and off 2.3 percent from September 2015. Freddie servicing was up 1.6 percent for the quarter and up...

Inside MBS & ABS

Commercial Mortgage Securitization Gained Momentum In Third Quarter, But 2016 Still Well Behind Last Year

New issuance of commercial mortgage securities increased substantially during the third quarter, with both the private and agency sectors posting solid gains, according to a new Inside MBS & ABS analysis. A total of $53.14 billion of income properties were securitized during the third quarter, a 33.4 percent increase from the previous period and the strongest three-month output since the second quarter of last year. That brought year-to-date issuance to $137.74 billion, off 12.4 percent from the pace set in the first nine months of 2015, and it would take a huge fourth-quarter surge for the market to reach last year’s total. Non-agency commercial MBS production rose...[Includes one data table]

Inside Mortgage Trends

Agency MSR Transfer Market Gained Speed in 3Q16 But Won’t Catch 2015

The secondary market in transfers of agency mortgage servicing rights gained some momentum during the third quarter of 2016, according to a new Inside Mortgage Trends analysis and ranking. A total of $94.96 billion of Fannie Mae, Freddie Mac and Ginnie Mae MSR connected to newly issued mortgage-backed securities changed hands during the third quarter. That was up 9.4 percent from the second quarter and represented the heaviest volume since ... [Includes two data charts]

Inside Nonconforming Markets

Retail Channel Is Dominant Source Of Jumbo Mortgages in Early 2016

The jumbo market is dominated by retail lenders to a greater extent than either conventional-conforming production or government-insured lending, according to a new analysis by Inside Nonconforming Markets. A group of 19 top jumbo lenders reported $92.45 billion in jumbo originations through their retail operations during the first half of 2016. That represented 76.8 percent of the $120.37 billion in total jumbo production for the group. The 19 lenders accounted...[Includes one data table]

Inside FHA/VA Lending

Nonbanks Took Over GNMA Servicing Market in 3Q16

Nonbanks crossed a threshold in the third quarter of 2016, posting a hefty 6.3 percent increase in their combined Ginnie Mae servicing portfolio, according to a new Inside FHA/VA Lending analysis. Nonbanks serviced $826.6 billion of Ginnie single-family mortgage-backed securities as of the end of September. That represented 51.3 percent of the total Ginnie market. The nonbank servicing total includes a small amount of Ginnie servicing held by state housing finance agencies, roughly 1.0 percent of the entire market. But it doesn’t include the significant amount of Ginnie servicing that nonbanks do as subservicers for both depository and nonbank clients. Interestingly, the biggest gain for nonbanks in percentage terms came in servicing VA loans, which rose 8.1 percent from the second quarter to $252.1 billion, or 51.0 percent of the market. The VA sector is one business from ... [4 charts ]

Inside the CFPB

PHH Ruling Seen as a Big Threat To CFPB Enforcement Actions

The CFPB took a whipping last week in the long-awaited court ruling in its dispute with PHH Mortgage – so much so, in fact, that not only are its future enforcement actions likely to be curtailed, but even past actions might be challenged by the affected industry participants. “The ramifications of this case go far beyond restricting the CFPB’s reach, clarifying the interpretation of the Real Estate Settlement Procedures Act, and resolving the question of how statutes of limitation apply to the CFPB’s enforcement actions,” said Craig Nazzaro, of counsel with the Baker Donelson law firm in Atlanta, in a review of the case. As he sees it, this case makes clear that the bureau has exceeded its bounds and that ...


After the November elections, how long will it take for a new Congress and White House to pass GSE reform legislation?

I’m confident a bill will be passed the first year.


2 to 3 years. GSE reform is complicated.


Sadly it won’t happen in a Clinton or Trump first term.


Not in my lifetime.


Housing Pulse