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Volume 20 - Number 10

May 13, 2016

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GSE Sellers Launch Aggressive Campaign To Expand Purchase-Mortgage Credit

Fannie Mae and Freddie Mac loan sellers pushed hard to increase originations of purchase-money mortgages during the first quarter of 2016, according to a new Inside Mortgage Trends analysis. The biggest beneficiaries were loan applicants with lower credit scores. In the first quarter of this year, 21.4 percent of purchase mortgages sold to the two government-sponsored enterprises had credit scores in the 620 to 699 range. That was up from just 14.4 percent in ... [Includes two data charts]

Nonbanks Take a Beating in Early 2016

Falling interest rates pounded the earnings of publicly traded nonbank lenders in early 2016 by forcing them to take huge writedowns on their mortgage servicing rights. The nine nonbank lenders tracked by Inside Mortgage Trends reported a combined $510.0 million loss in the first quarter, following a $12.7 million loss in the previous period. Back in the first quarter of 2015, the group had a combined $104.5 million in net income from their ... [Includes one data chart]

Investors Find Solace in PHH ‘Book’ Value

If you’re searching for some good news on the troubled PHH Corp., look no further than the book value of the company’s common stock, which is roughly $23 a share, according to a recent calculation from Sterne Agee CRT. In trading late this week, PHH’s share price was a mere $12.60, which means there appears to be plenty of upside as long as management can right the troubled ship and find a way forward as private-label clients fall to the wayside and servicing "marks" ...

Lenders Turn to Warehouse Securitizations

Two lenders are returning to the structured finance market in an uncommon way, participating in a $210 million mortgage warehouse securitization. The transaction involving agency originations received provisional AAA ratings from Moody’s Investors Service last week. Station Place Securitization Trust 2016-3 will be backed by a revolving pool of agency mortgages originated by Greentree Mortgage and loanDepot. The two lenders participated in a similar $225 million deal ...

‘EarlyLook’ HMDA Data Show Drop in Denial Rate

A preliminary analysis of 2015 Home Mortgage Disclosure Act reports suggests that loan denial rates declined slightly last year. ComplianceTech, a supplier of fair lending and HMDA technologies for lenders and others, recently released an “EarlyLook” at its online Lending Patterns database of HMDA reports. A group of 175 lenders had a combined $730.9 billion in mortgage originations last year, up 35.7 percent from its volume back in 2014. The 175 aren’t necessarily the ...

House Flipping Is Back in Some Areas, Profits Up

The practice of an individual investor purchasing a property, fixing it up and reselling it for a profit – an activity so prevalent before the financial crisis that it spawned television shows – is making a return, especially in certain markets, according to CoreLogic. “Flipping was at an all-time high before the housing bubble burst because of easy access to credit and speculation for higher home prices,” said Bin He, principal economist at CoreLogic, in a recent blog post ...

Altisource Reaches Deal with Activist Investors

Altisource Residential Corp. this week reached an agreement with a group of activist investors who control about 2.5 percent of the company’s stock and were concerned about the firm’s shift toward the single-family rental market. Altisource agreed to add two new independent directors and continue a $100 million stock buyback initiative. The so-called RESI Shareholders Group led by BLR Partners, a private equity firm, agreed to withdraw its nominations for replacements of ...

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