Mortgage Banking Profitability

Browse articles from all of our Newsletters related to Mortgage Banking Profitability.

February 8, 2016 - Inside the CFPB

In Brief: More About TRID

Will TRID Errors Crimp Earnings? Market observers have been hearing reports that TRID errors and closing delays definitely will be affecting first quarter 2016 earnings, at least for certain nonbanks. The big test for nonbank mortgage stocks is expected to come later this month when PHH Corp., the parent of PHH Mortgage, the nation’s ninth largest servicer, reports 4Q15 results. PHH, which is battling the CFPB over RESPA issues, also has been smacked around by servicing write-downs. It likely got some relief on that score in 4Q15. Stay tuned... CFPB Tries to Clear the TRID Air on Construction Loans. Not only has the CFPB’s TRID rule delayed closings in the conventional market, but it’s being reported that the regulation has ...

February 5, 2016 - Inside Mortgage Trends

Information Key to Third-Party Vendor Oversight

The financial crisis has led to a broader, more demanding quality control process to ensure that mistakes are never repeated and that financial institutions adhere strictly to compliance requirements. As a result, mortgage lenders are much more vulnerable now to enforcement actions if they are found to have inadequate controls in place or to be noncompliant. One of the pitfalls lenders worry about is being held responsible – and potentially liable – for the actions of third-party ...

February 5, 2016 - Inside Mortgage Trends

Banks Report Decline in Mortgage Banking Income in 4Q15, Year Ends Up From 2014

Mortgage banking income generally declined for commercial banks and thrifts in the fourth quarter, although 2015 was generally more profitable than the previous year, according to a new Inside Mortgage Trends analysis of earnings releases. A diverse group of 25 banks reported a total of $3.046 billion in mortgage-banking income for the fourth quarter. That was down 14.8 percent from the previous three-month period, and it marked the group’s lowest ... [Includes one data chart]

January 29, 2016 - Inside FHA/VA Lending

FHA Cuts Premiums for Multifamily, Energy-Efficient Properties

The Department of Housing and Urban Development this week announced an insurance rate reduction for multifamily affordable and energy-efficient properties to stimulate production and rehabilitation of affordable rental housing. The new reduced rates will take effect on April 1, 2016, and will directly affect FHA’s Multifamily Housing Programs and properties housing low- and moderate-income families. For “broadly affordable” housing, the FHA is lowering annual mortgage insurance rates to 25 basis points. Rates for affordable mixed-income properties would be lowered to 35 bps. For energy-efficient properties, the annual rates would be reduced to 25 bps. To ensure that broadly affordable and energy-efficient properties benefit directly from the lower rates, FHA will limit the fees that can be charged on these loans. “The reduction in mortgage insurance premiums for FHA loans on ...

January 29, 2016 - Inside FHA/VA Lending

FHA Extends Due-and-Payable Notifications for Problem HECMs

The FHA has given lenders and servicers an additional extension through April 17, 2016, to submit due-and-payable notices when Home Equity Conversion Mortgage borrowers fall behind on their property tax or insurance payments. The extended deadline also provides FHA lenders and servicers an opportunity to pursue loss mitigation before initiating foreclosureThe latest deadline extension was the second such extension. In April 2015, the FHA announced a policy change providing HECM lenders and servicers an additional 60 days in which to initiate foreclosure proceedings against any troubled HECM borrower with a case number issued prior to Aug. 4, 2014, with a non-borrowing spouse. Lenders and servicers are required to comply with reasonable-diligence timeframes for such HECMs. Debenture interest will not be curtailed during this period. The April policy allows mortgagees full discretion as to when to use the extension.

January 29, 2016 - Inside FHA/VA Lending

Private Flood Insurance Can Be FHA’s Ally During Emergencies

The FHA flood insurance requirements could make it difficult or more risky for lenders to originate FHA loans in states with significant flood risk or where flood maps may not accurately reflect the current flood risks, the Mortgage Bankers Association warned. Testifying during a recent hearing on private flood insurance, Steven Bradshaw, executive vice president of Standard Mortgage and MBA representative, warned that FHA’s current requirement for lenders to secure flood insurance on properties only if it is located within a high flood-risk zone has had some unexpected adverse impact, particularly in the wake of hurricane-related catastrophes. Bradshaw noted that many homes that were destroyed by Hurricane Katrina were not located in special flood-hazard areas (SFHA) and therefore were not required to have flood insurance. “Sadly, these borrowers were often uninsured and the ...

January 29, 2016 - Inside FHA/VA Lending

VA, USDA Issue 2016 Guidelines For Post-Bankruptcy Lending

The Department of Veterans Affairs and the U.S. Department of Agriculture Rural Housing Service have issued 2016 guidelines for lending to borrowers who have gone through a bankruptcy, foreclosure or a short sale. Under VA guidelines, borrowers emerging from a previous Chapter 7 bankruptcy may apply for a VA loan two years after the bankruptcy discharge. Borrowers with a Chapter 13 bankruptcy may qualify for a new VA loan if they have made at least 12 months of payments and the lender concludes that they have reestablished satisfactory credit. Before the bankruptcy-tainted borrower applies for a VA loan, however, the trustee or the bankruptcy judge must approve the new loan. The lender may put in a good word on behalf of the borrower provided the latter has met all requirements for a new loan. Borrowers may apply for a VA loan two years after a foreclosure or a short sale. In the case of ...

January 29, 2016 - Inside FHA/VA Lending

VA Issues Guide to Understanding Interim Qualified Mortgage Rule

The Department of Veterans Affairs has issued guidance to help VA lenders understand better the agency’s interim final rule on a borrower’s ability to repay and qualified mortgages. The guidance was published in a frequently asked questions (FAQs) format to clarify and explain both the VA’s ATR and QM standards. The VA interim final rule became effective on May 9, 2014, the date it was published in the Federal Register. The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 requires residential mortgage lenders to make a reasonable and good faith determination that the consumer has a reasonable ability to repay the loan according to its terms. The statute directed the Consumer Financial Protection Bureau to develop and implement an ATR/QM rule. Under the CFPB’s final rule, a qualified mortgage is a category of loans that have certain, more stable features that ...

January 29, 2016 - Inside FHA/VA Lending

GNMA Servicing Stable in 4Q15, Performance Improves Slightly

The FHA and VA mortgage servicing markets saw relatively little growth but steady performance trends during the fourth quarter of 2015, after a turbulent market early in the year. A new Inside FHA/VA Lending analysis of Ginnie Mae disclosure data shows delinquency rates edged slightly lower at the end of last year, although virtually all of the improvement was in the less-severe category of loans 30-60 days past due. The 60-to-90-day delinquency rate was unchanged for FHA loans but up slightly for VA loans. And both programs saw modest increases in loans more than 90 days past due. The data provide a mixed view of growth in the outstanding supply of FHA and VA servicing. According to Ginnie’s monthly summary, the outstanding balance of single-family mortgage-backed securities (excluding home-equity conversion mortgage pools) was $1.495 trillion at the end of ... [ 4 charts ]

January 22, 2016 - Inside Mortgage Trends

FICO Scores On the Way Out? Yes, Says CA Lender

Social Finance Inc.’s recent decision to stop using FICO scores when evaluating an applicant’s ability to repay a mortgage suggests that alternatives to the traditional credit-scoring model are catching hold. On Jan. 12, 2016, SoFi, a San Francisco-based online nonbank lender, announced it is no longer going to use FICO scores, which for years have been the basis for the origination of trillions of dollars in mortgage and consumer loans in the U.S. SoFi will still take into account ...

January 22, 2016 - Inside Mortgage Trends

Study: Market Concentration Slowed Recovery

In the aftermath of the financial crisis, mortgage originations recovered more slowly in areas where market share was concentrated among fewer lenders, according to a new study by Adonis Antoniades. The author is an economist in the monetary and economic department of the Bank for International Settlements. Antoniades used data from the Home Mortgage Disclosure Act to study loan applications, originations and lenders’ market share on a county-by-county level from 2006 through 2011 ...

January 22, 2016 - Inside Mortgage Trends

Potential Refi Segment Shrinking, Rates a Factor

The portion of the homeowner population that is capable of benefitting from refinancing their mortgages is shrinking, and could continue to shrivel if mortgage rates rise along with interest rate increases from the Federal Reserve. But the good news is that rates have actually been falling of late as investors around the world seek the stability of U.S. dollar-dominated assets, so that slice of the refi pie could actually grow if the present market turmoil continues. “Looking at current interest rates ...

January 22, 2016 - Inside Mortgage Trends

Big Banks Say Mortgage Banking Income Up in 2015 Despite Yearend Downturn

A group of five large banks posted a 7.5 percent increase in mortgage-banking income in 2015 compared with the previous year, according to a new analysis by Inside Mortgage Trends. Officials at the banks pointed to a stronger housing market along with reduced servicing costs. Wells Fargo continued to lead the industry in terms of both mortgage-banking income and originations at the end of 2015. The bank had $6.50 billion in mortgage-banking income during the year ...

January 22, 2016 - Inside MBS & ABS

MBS Trading Desks Restructured as Liquidity Declines, Changes Afoot at Barclays, SocGen and Wunderlich

The average daily trading volume for agency MBS fell to a yearly low of $149.2 billion in December, as trading desks from coast to coast continued to assess how to make money in what’s become a business of tight profit margins. Late this week, Barclays Bank unveiled a massive restructuring of its MBS and whole-loan trading business, cutting the number of employees in the division – including traders – down to 50 from roughly 100. As a structural matter, the bank is moving...

January 21, 2016 - Inside Mortgage Finance

Underwater Homeowners to Be Provided Relief in Goldman Sachs’ $5.1 Billion Settlement Pact with Agencies, State AGs

Part of the $5.1 billion settlement amount Goldman Sachs agreed to in principle with the federal government last week will be used to provide relief for homeowners who owe more than the current appraised value of their homes. The agreement would resolve an ongoing investigation by the Residential Mortgage-Backed Securities Working Group of the U.S. Financial Fraud Enforcement Task Force, which President Obama established in 2009 to pursue those who played a role in causing the financial crisis. The tentative agreement would resolve...

January 21, 2016 - Inside Mortgage Finance

Little Evidence of TRID Damage So Far at Big Banks, As Volumes Already Seem to be Bouncing Back

Earnings season has begun, and among the biggest financial institutions and mortgage lenders that have reported thus far, there’s been little evidence of damage to the bottom line as a result of the Consumer Financial Protection Bureau’s integrated disclosure rule known as TRID. At top-ranked Wells Fargo, total loan production for the fourth quarter was $47 billion, versus $55 billion in the third quarter, and $44 billion in the fourth quarter of 2014, something Chairman and CEO John Stumpf attributed to seasonality as well as TRID. During an earnings-related conference call with investors last week, Stumpf was asked...

January 15, 2016 - Inside FHA/VA Lending

Radian Asserts Compliance as PMIERS Became Effective

Radian Guaranty became the first among seven private mortgage insurers to declare compliance with the regulatory capital standards under the Private Mortgage Insurer Eligibility Requirements (PMIERs). Radian met its PMIERs goals after receiving $325 million in cash and marketable securities from its parent Radian Group in exchange for a surplus note. In addition, the parent firm contributed $50 million to an exclusive affiliated reinsurer of Radian Guaranty. Radian Group expects the capital cushion to increase based in part on expected future financial performance at its MI subsidiary. Monies from other sources, including a profit commission of about $8 million based on performance to date, and $8.5 million in prepaid supplemental ceding commission also contributed to the MI’s capital. Hence, Radian Guaranty is not expected to require any additional capital contributions in order to ...

January 15, 2016 - Inside FHA/VA Lending

HECM-Backed NPL Deal’s Strong Points Help Overcome Downside

The first rated securitization backed by nonperforming Home Equity Conversion Mortgage loans contains strong, credit-positive features that outweigh the credit risk associated with nonperforming loans, according to a Moody’s Investors Service analysis. The effect of some of these positive features on the performance of Nationstar HECM Loan Trust 2015-2, however, depends on whether Nationstar Mortgage remains as servicer for the transaction, said the rating agency. Nationstar has a servicer rating of B2/Stable from Moody’s and is also the transaction’s sponsor. Nationstar issued NHLT 2015-2 in November 2015 and by the end of December, the first remittance report showed strong initial performance. Credit enhancement to the Aaa (sf)-rated notes increased by 1.69 percent in the first month of operations, Moody’s noted. “As long as Nationstar continues to be the ...

January 15, 2016 - Inside FHA/VA Lending

Broker Seeks Bids on $3 Billion GNMA Bulk Residential MSRs

Interactive Mortgage Advisors is auctioning off $3.02 billion in Ginnie Mae residential mortgage-servicing rights for an undisclosed client. According to IMA, the seller is a “well-known, independent mortgage banker with very strong net worth and well-versed in servicing transfers.” The loans are being sub-serviced by LoanCare. The MSR package consists of 17,989 loans – FHA (15,288) and VA (2,610) – with an average loan size of $168,886. The yield on the underlying mortgages is 4.069 percent. The service fee is 0.2917 percent. An estimated 8.92 percent of all loans in the deal are delinquent. Approximately 3.07 percent of the loans are either in bankruptcy or in foreclosure. The top states in the transaction are Texas, which accounted for 11.4 percent of all loans; California, 9.6 percent; Florida, 8.1 percent; and New York, 5.8 percent. The deadline for ...

January 15, 2016 - Inside FHA/VA Lending

VA Posts 2016 State Foreclosure Timeframes Following Review

The Department of Veterans Affairs has posted a chart on its web site showing the revised maximum allowable foreclosure timeframes for each state in 2016. State foreclosure timeframes are used in calculating the maximum interest payable on a foreclosure of a VA loan. They are subject to annual reviews and revised as needed. The chart reflects maximum allowable foreclosure periods that include the 210 calendar days for unpaid interest as well as foreclosure periods without the 210 days. Specifically, the chart shows timeframes the VA has determined to be “reasonable and customary” for all states, following an annual review of amounts allowed by other government-related home loan programs, such as FHA, Fannie Mae and Freddie Mac. The chart also lists the maximum amounts that will be paid on a claim processed in the ...

January 15, 2016 - Inside FHA/VA Lending

Non-Borrower Spouse Issue Arises, VA Explains Use of Loan Guaranty

The Department of Veterans Affairs has issued a clarification for non-borrower spouses on VA title documents, which apparently has created some confusion when lenders try to foreclose on VA-backed properties. VA is aware that lenders occasionally make loans to veterans who wish to use their home loan benefit to purchase a home and include their spouse in ownership, but the spouse does not wish to be on the mortgage loan. Including the spouse on the deed but not on the mortgage note can create a problem if the VA loan goes into foreclosure because the non-borrowing spouse’s ownership in the property could defeat the foreclosure action, the VA explained. “Delaying or preventing a foreclosure increases foreclosure claim cost to the government and the veteran,” the agency said. According to the VA guidance, when a loan is originated that includes a ...

January 15, 2016 - Inside FHA/VA Lending

Quicken Loans to Request Change Of Venue for DOJ’s FCA Lawsuit

Quicken Loan attempt to have a governmen false-claim lawsuit against the lender moved from Washington, DC, to a federal court in Detroit will not necessarily secure a win, according to a mortgage industry attorney. “I think it was more the device Quicken needed in order to become the plaintiff instead of the defendant,” said one attorney who preferred to remain anonymous because his firm handles other legal matters for Quicken Loans. He said it does not matter whether the case is tried in Washington or Detroit but what matters is its actual substance. At the same time, there is no reason why those defenses could not be raised in a DC court, the attorney added. Last month, a federal judge in Detroit dismissed Quicken’s preemptive lawsuit against the Department of Housing and Urban Development and the Justice Department for failure to state a claim. Ultimately, the court ...

January 15, 2016 - Inside FHA/VA Lending

TRID Compliance Excluded from FHA Post-Endorsement Reviews

FHA lenders are uneasy over whether issues raised by the Consumer Financial Protection Bureau’s new integrated disclosure rules could affect FHA lending. Although the issues cited by lenders are not FHA issues per se, these lenders are concerned that such uncertainties may cause problems for their FHA business, according to mortgage industry consultant Brian Chappelle, a principal at Potomac Partners. For example if a lender cures a mistake and the cure results in a reimbursement of, say, $100 to the borrower at closing, would that be considered a violation of the Department of Housing and Urban Development’s minimum 3.5 percent cash-investment requirement for FHA loans. “I don’t think it is a violation, but lenders are worried about how HUD might interpret it,” said Chappelle. “It is well after closing and it is obviously not a gift given to the borrower. It is ...

January 15, 2016 - Inside FHA/VA Lending

Ginnie Mae Issuance Hits New High In Securitized VA, FHA, RHS Loans

Issuers of Ginnie Mae mortgage-backed securities pushed a record $435.80 billion of government-insured loans through the program during 2015, according to a new Inside FHA/VA Lending analysis and ranking. Last year’s total Ginnie MBS issuance topped the previous record of $429.50 billion issued during 2009. The $435.80 billion total for 2015 includes securitization of FHA home-equity conversion mortgages and other single-family loans guaranteed by FHA, the VA, and the Department of Agriculture rural housing program from Ginnie pool-level MBS data that are not truncated. Production in 2015 hit its high-water mark in the third quarter with $128.23 billion in issuance, and then fell 18.0 percent in the final three months of the year. Purchase mortgages continued to account for most Ginnie business in 2015, 58.0 percent of the agency’s forward-mortgage securitizations. But a huge factor in the ... [ Charts ]

January 14, 2016 - Inside Mortgage Finance

It Was an Ugly Ride for Most Nonbank Mortgage Stocks in 2015. Have We Reached the Bottom?

Although residential production increased by roughly 30 percent in 2015 over the year prior, investors beat down nonbank mortgage stocks with a vengeance as continued low interest rates forced huge markdowns on the value of servicing rights. According to an analysis of eight publicly traded nonbank lender-servicers by Inside Mortgage Finance, the stock prices of these firms are currently trading at steep discounts to their 52-week highs, with most a dollar or two above their lows. ...

January 8, 2016 - Inside Mortgage Trends

Lenders Generally Gloomier About Profit Margins

Mortgage lenders became gradually more pessimistic about profit margins in 2015, according to Fannie Mae’s most recent lender sentiment survey. In the fourth-quarter survey, 42 percent of respondents expected profit margins to shrink over the next three months. Back in the first quarter of 2015, only 10 percent were in that camp, though the group grew to 25 percent in the second and 38 percent in the third quarters of last year. A minority (13 percent) said they expect margins to ...

January 8, 2016 - Inside Mortgage Trends

Real Estate Values Getting Higher in Colorado

The legalization of marijuana has had a lucrative impact on Colorado’s economy, increasing tax receipts to the state. But housing professionals aren’t quite sure if the pot “boom” is also responsible for driving up home values. “We don’t have current statistics related to that industry,” said Kelly Moye, a spokesperson for the Colorado Association of Realtors. According to Moye, that’s partly why it’s difficult to attribute the increase in home prices to the booming weed market. But Moye notes ...

January 8, 2016 - Inside Mortgage Trends

Prospects for New Home-Equity Lending Are Rising

It’s not too late for lenders to catch the home-equity lending wave, which has rebounded after the housing market collapse and steadily gathered strength for well over a year now, according to Sam Khater, deputy chief economist at CoreLogic. “Home-equity lending, for years the red-headed stepchild of our industry, is coming back into favor, thanks to the growth in equity that millions of American homeowners are experiencing, and the improving economy,” Khater said ...

January 8, 2016 - Inside Mortgage Trends

Consolidation Happens in Due Diligence Space

Due diligence provider American Mortgage Consultants recently purchased the like-minded JCIII & Associates for an undisclosed sum, a transaction that could be a harbinger of additional consolidation in the sector. In fact, market sources contend that eventually American Mortgage Consultants will hit the auction block too – it’s just a matter of when. According to one due diligence source, the purchase of JCIII helps AMC build “critical mass,” which will attract buyers or at least ...

January 8, 2016 - Inside Mortgage Trends

Correspondent Buyback Disputes Hinge on Contract

A recent appeals court ruling demonstrates that courts will look to contract terms between correspondent lenders and loan purchasers when determining the validity of buyback claims. In CitiMortgage v. Chicago Bancorp, the loan purchaser prevailed, with judges noting that the correspondent seller breached the contract by refusing to cure or repurchase loans. The two firms had a contract under which Citi agreed to buy mortgages underwritten or originated by Chicago Bancorp ...

January 7, 2016 - Inside Mortgage Finance

With Their Stocks in the Tank, Two Large Nonbanks Roll Out Debt Offerings and Plans to Buy Back Stock

PHH Corp. and Nationstar Mortgage – both top 10 ranked residential servicers – recently filed to sell debt securities, an odd situation for two companies struggling with low share valuations amid a lack of confidence among both investors and stock analysts. The lender/servicers also have unveiled stock buyback programs, though such announcements usually represent a desire to do so, and not a contractual obligation. PHH’s Form S-3 filing with the Securities and Exchange Commission offers...

January 1, 2016 - Inside FHA/VA Lending

Joint Enforcement Actions Result In Huge Recoveries for FHA in 2015

Joint civil fraud initiatives have resulted in $558.5 million in recoveries and receivables to the Department of Housing and Urban Development in FY 2015, according to the HUD inspector general’s semiannual report to Congress. The amount includes civil settlements of $212.5 million from First Tennessee Bank, $29.6 million from Reverse Mortgage Solutions, and $1.8 million from three other settlements. The settlements resolved enforcement actions brought by the Department of Justice on behalf of HUD in pursuit of civil remedies under a variety of statutes, including the False Claims Act, Program Fraud Civil Remedies Act, and the Financial Institutions Reform, Recovery and Enforcement Act. Recoveries and receivables for other entities during the reporting period – April 1 to Sept. 30, 2015 – totaled $86.9 million and $268.2 million for the entire fiscal year. Some of the payments were made to the ...

January 1, 2016 - Inside FHA/VA Lending

Lenders’ Mitigation Efforts Reduce Share of ‘Unacceptable’ Mortgages

The share of “unacceptable” ratings for defective FHA loans following a post-endorsement technical review has dropped from double- to single-digits in FY 2015 due to lenders’ mitigation efforts, according to the FHA’s latest loan-review results. FHA’s initial unacceptable rate has remained at 45 to 47 percent over the last four quarters, but lender submission of mitigating documentation has reduced that rate to 5 percent as of Oct. 31, 2015, the FHA report said. This means an overall mitigation rate of nearly 90 percent of the FHA-insured loan sample. The number of initially unacceptable findings and those findings subsequently mitigated are based on 6,415 FHA-insured mortgages that underwent post-endorsement technical reviews between April 1 and June 30, 2015. Of the total loans reviewed, 68.6 percent were purchase loans, 17.9 percent streamline refinance and ...

January 1, 2016 - Inside FHA/VA Lending

VA to Propose Rule Changes on Fees, LDPs, Appraisers, Income

The Department of Veterans Affairs is planning to propose changes to rules under its Home Loan Guaranty program related to loan fees, appraisers, limited denial of participation and residual income. Three of the proposed rules are slated for publication in the first quarter of 2016, according to the VA’s semiannual regulatory agenda. Agenda items, however, usually do not follow their publication dates and most rulemakings take a while before they are finalized. One proposed rule would establish reasonable fees that VA lenders may charge in connection with the origination and servicing of VA loans. All proposed fees would be in line with those charged by private mortgage lenders, assuring the sustainability of the VA loan program, the agency noted. In addition, the VA plans to propose rule changes regarding limited denials of participation (LDPs). LDPs are VA-specific sanctions that the Loan Guaranty Service may ...

January 1, 2016 - Inside FHA/VA Lending

VA Loan Limits Stay Same in 2016, Guaranty Based on One-Unit Limit

The Department of Veterans Affairs has announced its loan limits for 2016, which are the same as the loan limits set by the Federal Housing Finance Agency for Fannie Mae and Freddie Mac this year. Currently, the VA’s maximum guaranty amounts are indexed to the FHFA loan limits, which range from a base of $417,000 to a high-cost area limit of $625,500. The FHFA conforming loan limit will remain unchanged at $417,000 for single-family homes, effective Jan. 1, 2016, to Dec. 31, 2016. However, in 39 counties deemed “high cost,” the conforming loan limits will increase this year. VA loan limits are calculated based on the county median home values reported by FHA. The maximum guaranty amount for loans over $144,000 is 25 percent of the current VA county loan limit. Veterans with full entitlement available may borrow up to this limit and VA will guarantee 25 percent of the loan amount. In addition, the VA county limits ...

January 1, 2016 - Inside FHA/VA Lending

FHA Urges Calendar-Year Lenders To Begin Recertification Early

Nearly 2,400 FHA lenders will receive electronic notifications on Jan. 1, 2016, from the Department of Housing and Urban Development instructing them to begin their recertification process or risk exclusion from the FHA program. HUD is encouraging the estimated 85 percent of FHA lenders that operate on a calendar-year basis, instead of a fiscal-year basis, to prepare their recertification packages for submission to the Lender Electronic Assessment Portal (LEAP). LEAP allows FHA lenders to complete annual recertification, among other things. The portal is accessible through FHA Connection, which provides lenders and business partners a path to HUD’s computer systems. Annual recertification can be a lengthy, time-consuming process for ...

January 1, 2016 - Inside FHA/VA Lending

Ginnie Pools Likely to See Rising Share of VA Collateral in 2016

Investors should see a higher share of VA collateral in Ginnie Mae mortgage-backed securities pools due to increasing VA loan originations, according to Deutsche Bank analysts. Given their rising share of VA collateral, new Ginnie pools are likely to have worse convexity than most of those originated in 2015, analysts said. “VA loans tend to prepay faster than FHA loans when in the money as VA loans have larger loan sizes, higher FICO scores and a more efficient streamline refi program that requires a minimum three months seasoning,” they observed. In addition, analysts expect the population of younger veterans to surge approximately 36 percent over the next five years. “[As such], there will be a healthy supply of new VA originations eligible for pooling,” they said. As a result, the share of FHA relative to VA collateral in new Ginnie II pools will likely decrease, they said. Such a trend has manifested itself slowly as ...


A lot has been written lately regarding loan closing delays tied to the new TRID rule. What’s been the average delay at your lending shop, if at all? (Report in business days, not calendar.)

TRID has caused no delays whatsoever because we were prepared.


1 to 4 days.


5 to 10 days.


11 to 15 days. It’s been a nightmare.


We’re too embarrassed to tell you.


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