Home Equity Loans

Browse articles from all of our Newsletters related to Home Equity Loans.

September 12, 2014 - Inside FHA Lending

FHA Lending Back on Track with <680 Score

The average FHA credit score in the second quarter of 2014 continued to decline from the record highs of 2011, but remains well above the levels preceding the mortgage and credit crisis, according to FHA’s latest report to Congress on the state of the agency’s Mutual Mortgage Insurance Fund. The FHA’s second-quarter average credit score of 680 was 3 points below the previous quarter’s score and 13 points below the score during the same period last year. The report’s data suggest that FHA has accomplished its goal of shifting its market share to the 620-679 credit score bucket consistent with its target market while ceding its share of loans with scores exceeding 720 to the private MI sector. The last time borrowers’ average credit score hit 680 was in the second quarter of 2009. FHA officials said they are working to have 75 percent of the FHA lending in the ...


September 12, 2014 - Inside FHA Lending

MMIF in Negative Cash Flow in 2Q14, Says Report

The FHA Mutual Mortgage Insurance Fund account balances fell by $0.5 billion during the second quarter of 2014 to $45.3 billion due to higher claim payments and property expenses. Observers, nonetheless, remain optimistic the fund will return to full stability in 2015 with no further change in the mortgage insurance premium charged to borrowers. The MMIF’s total balances peaked at $48.4 billion in the third quarter of 2013 and then slipped gradually over the last three quarters, according to data in the FHA’s latest report to Congress regarding the financial health of the Mutual Mortgage Insurance Fund. Total revenues from premium collections, property sale, and note sale proceeds were $4.3 billion, while $5.1 billion was paid to cover claims and property expenses in the second quarter. This resulted in a negative$821 million cash flow in the quarter, the smallest outflow since ...


September 4, 2014 - Inside Mortgage Finance

Conventional Market Grew Slightly Faster in 2Q14 Mortgage Origination Surge; Refinancing Sinks

Production of conventional mortgages – those eligible for sale to Fannie Mae and Freddie Mac as well as jumbo loans – grew at a faster rate than the government-insured market during the second quarter of 2014, according to a new Inside Mortgage Finance analysis. Origination of conventional-conforming mortgages increased by 24.4 percent from the first quarter, climbing to an estimated $153.0 billion. While that continued to account for the biggest chunk of new business – 52.1 percent – the biggest proportional increase in new lending came in the jumbo mortgage sector, where new originations jumped 34.1 percent during the second quarter. Production of government-insured mortgages, including FHA, VA and rural housing loans, increased...[Includes two data charts]


August 29, 2014 - Inside FHA Lending

GNMA Unable to Use $200 Million Windfall

Roughly $1 billion in damages will flow through to the FHA and Ginnie Mae from Bank of America’s record $16.65 billion global mortgage-backed securities settlement with the Department of Justice. Although most of the DOJ’s case centered around faulty private-label MBS that BofA and its forbears (namely Countrywide and Merrill Lynch) underwrote during the housing boom, a small piece of the settlement is tied to servicing chores that the bank did for Ginnie Mae. And apparently, BofA didn’t do a very good job of servicing the underlying product. The bank took over as the subservicer on roughly $26.2 billion in mortgage servicing rights that once belonged to Taylor, Bean & Whitaker, a large nonbank based in Ocala, FL. When TBW went bust in the second half of 2009, BofA was given the subservicing contract. “BofA serviced the loans for us,” said Ginnie Mae president Ted Tozer. “And they did a ...


August 15, 2014 - Inside FHA Lending

Reverse Mortgages Reportable Under HMDA

Reverse mortgages would be included in Home Mortgage Disclosure Act reports under a proposed rule published recently by the Consumer Financial Protection Bureau. The proposed rule would expand the definition of a “covered loan” under HMDA to include reverse mortgages and home-equity lines of credit (HELOCs), which include reverse mortgages structured as open-end HELOCs. Currently, HMDA regulations do not require reporting of HELOCs, although lenders may do so if they choose. Currently, financial institutions only have to report information on a closed-end reverse mortgage if the transaction involves a home purchase, home improvement or refinancing. Among other things, the CFPB has proposed to require that all reverse mortgages and HELOCs be identified by loan type to distinguish them from other categories of ...


August 15, 2014 - Inside FHA Lending

GNMA’s Conversion Plan: Devil is in the Details

Two industry trade groups expressed support for consolidating Ginnie Mae’s mortgage-backed securities program and creating a new MBS but they are at loggerheads on some of the details. Commenting on the Ginnie Mae proposal, the Securities Industry and Financial Markets Association (SIFMA) and the Mortgage Bankers Association (MBA) said the disagreements are mostly on how to resolve issues related to winding down the Ginnie Mae I MBS program and providing a conversion option for existing securities. “It is clear that further discussion is warranted, and direct engagement with key stakeholders should be beneficial,” the trade groups suggested. Ginnie Mae has received considerable support from a variety of industry players for its “straw man” proposal to shift to a single MBS program based on the existing Ginnie II. The program now accounts for more than 90 percent of all ...


August 15, 2014 - Inside FHA Lending

Private MIs, VA Overtake Faltering FHA Program

Weighed down by high premium costs and lender overlays, FHA lost more primary market share to private mortgage insurers and the Department of Veterans Affairs during the second quarter of 2014. Although June’s FHA endorsement numbers have not yet been released, the trend seen in April through May, along with Ginnie Mae securitization data, suggest that FHA business was up a modest 11.5 percent from the first quarter. But that increase provides no comfort to FHA, which saw its market share go down to 33.7 percent, a six-year low. From April to May, FHA forward endorsements rose by 2.4 percent to $10.61 billion. On a year-over-year basis, however, endorsements were down from $21.9 billion in May 2013, according to an Inside FHA Lending analysis of agency data. On the other hand, private MI companies reported a total of $44.19 billion of new insurance written (NIW) during the ... [2 charts]


August 15, 2014 - Inside FHA Lending

FHA Chief Galante to Resign in the Fall

FHA Commissioner Carol Galante has announced plans to step down from her current post, leaving behind a Mutual Mortgage Insurance Fund that appears well on its way to recovery and a slumping FHA business. Industry response to Galante’s Aug. 12 announcement was mixed. Some stakeholders applauded her toughness and resolve in steering FHA through hard times, while others criticized her for policies that made it more difficult and costly for first-time homebuyers to obtain an FHA-insured mortgage loan. Galante’s nearly three-and-a-half year stint as FHA commissioner was highlighted by her efforts to stabilize the FHA’s ailing Mutual Mortgage Insurance Fund, reduce losses and improve lender oversight. She achieved these goals by creating a comprehensive risk-management structure at FHA, revamping FHA pricing and credit policies, and ...


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