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Volume 20 - Number 19

September 16, 2016

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Production Profits Rose in 2Q16, But Rate Volatility Hammered Servicing

With rising origination volume and solid gain-on-sale margins, the business of originating and selling home loans generated substantially more earnings during the second quarter of 2016, according to a new Inside Mortgage Trends analysis of earnings reports. But the servicing side of the business had trouble generating positive income after taking into account gyrations in mortgage servicing rights valuations and the hedges lenders place on these assets ... [Includes one data chart]

MBA: Production Profits Doubled in 2Q16

Mortgage bankers booked hefty earnings on their loan origination and secondary marketing during the second quarter, but servicing hedges deepened, according to the latest Mortgage Bankers Association performance report. The average company participating in the survey reported pretax income of $2.913 million during the second quarter, nearly quadruple the average for the previous period. That lifted year-to-date pretax income to $3.665 million, still off 16.7 percent ...

Advanced Analytics Seen as Key for Growth

Benchmarking and other advanced analytics are helping many lenders grow their originations, according to TransUnion, a provider of data, analytics and consulting services. A recent survey by the company also found that a majority of lending organizations lack the resources to realize the competitive benefits of analytics. Versta Research surveyed 309 banks on behalf of TransUnion. Some 66 percent of the lenders said data and analytics are evolving faster than ...

Bank Repurchases Bounce Higher in 2Q16

Mortgage repurchase activity by banks and thrifts took an unexpected turn higher during the second quarter, according to a new Inside Mortgage Trends analysis of call reports. Call reports show that banks and thrifts repurchased $804.1 million of single-family mortgages, or otherwise indemnified a buyer, during the second quarter. That was up $40.0 million or 5.2 percent from the first three months of the year and marked the second straight quarterly ... [Includes one data chart]

GMFS Mortgage Tested by Louisiana Flood

On August 11, 2016, the most severe storm in decades hit southern Louisiana, including the city of Baton Rouge and 22 surrounding parishes. The massive rainfall brought an estimated 29 inches over a two-day period, submerging homes in three to six feet of floodwater and stranding thousands of people in their homes. On the east side of Baton Rouge is the Amite River, which separates the Ascension and Livingston parishes, where a good number of GMFS Mortgage employees ...

Clinton and Trump Both Support Homeownership

Presidential candidates Hillary Clinton and Donald Trump both want to promote homeownership, but they have different views on how to go about it. The Democrats’ platform supports giving “everyone a fair shot at homeownership” in America by putting them in a financial position to own a home, and preserving the 30-year fixed-rate mortgage while “modernizing” credit score models. The GOP platform assures voters that the “American Dream” of homeownership “is not a stale slogan,” ...

TRID Led to More Compliance-Related Defects

Mortgage lenders were making big strides in reducing the number of loan defects related to documentation just as the new integrated disclosure rule took effect, leading to a surge in compliance-related defects. That’s according to a new report based on an analysis of the post-closing quality control data associated with more than 50,000 mortgages that was performed by ACES Risk Management Corp., otherwise known as ARMCO, a provider of web-based audit technology ...


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.

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