Latest News

Down Now, Servicing Rights Could Turn to Gold Later
May 29, 2020
Why sell now when you can make a ton of money later?
Non-QM Lenders Return, but Carefully. NewFi Lowers Its LTV Max to 60%
May 29, 2020
After the pandemic changed its worldview, NewFi lowered its LTV on non-QM offerings to 60%...
MBA Cautiously Optimistic Annual Convention Will Be Held in Chicago
May 29, 2020
Conferences, exhibit halls and the sponsorships that go along with them are an important source of revenue for many trade groups...
Senate Democrats Query FHFA and CFPB on COVID-19 Forbearance
May 29, 2020
The senators write: “The CFPB and FHFA must also have plans to use their respective tools and authorities to immediately address trends that indicate borrowers are receiving inaccurate information or unequal treatment, or that servicers are not complying with the law.”

VA
Refi Wave Carries VA to Record Level in Early 2020
Thanks largely to a revived streamlined-refi program, the VA produced a record $82.6 billion of home loan guaranties in the first quarter, extending its lead over the FHA. (Includes five data charts.)
Originations
Share of Noncore GSE Business Increases in 1Q
In areas where the GSEs are seen as competing with the non-agency market, business was good for the GSEs in the first quarter of 2020. (Includes data chart.)
Agency MBS
Bank/Thrift MBS Holdings Grow in Volatile 1Q Market
Banks and thrifts held a record $2.11 trillion of residential MBS at the end of March as the pandemic began to mushroom. JPMorgan Chase upped its MBS by $52.9 billion in the first quarter.
Originations
Wholesale-Broker Channel Rebounds Bigtime in 1Q20
Traditional retail mortgage lending declined in the first quarter and correspondent production tanked. But the wholesale-broker sector, led by its flagship lender, posted a solid gain. (Includes six data charts.)
Agency MBS
GSE Sellers Put Pedal to the Metal in April MBS Volume
Heavy refinance volume pushed Fannie/Freddie MBS production to $175.5 billion in April, one of the highest monthly totals in GSE history. Nonbanks continued to lead the charge. (Includes two data charts.)
Earnings
Banks See Modest Boost in Mortgage Banking Income
Despite substantial declines in mortgage banking profitability at Wells Fargo and JPMorgan Chase, the banking industry saw a modest gain in earnings during the first quarter. (Includes data chart.)

Inside Mortgage Finance

Jumbo Mortgage Market Down Significantly in 1Q20
Pandemic-related market volatility in March dampened non-agency jumbo lending more than other sectors in the mortgage business. Conforming-jumbo production also fell sharply in the first quarter but began regaining momentum in April. (Includes three data charts.)
Unsaleable MSRs Could Turn to Gold in a Few Months
Mortgage servicing rights have little value in today’s secondary market, but investment bankers predict that one day, maybe soon, this volatile asset will once again rise from the ashes.
- New Capital Rule Could Delay GSEs’ Public Offerings
- As Warehouse Demand Surges, Financiers Tweak the Rules
More Inside Mortgage Finance

Inside MBS & ABS

Banks Report Modest Gain in ABS Holdings in 1Q20
May 28, 2020
The top two bank ABS investors — TD Bank and Charles Schwab — pared back their holdings in 1Q, but sizable increases at Bank of America and oth-ers boosted the industry’s total position in the market. (Includes two data charts.)
ABS Investors Treading Cautiously Amid Volatility
May 28, 2020
Investors in the ABS market are mostly staying on the sidelines waiting for the coronavirus volatility to play itself out. Meanwhile, some investors are focusing solely on AAA-rated assets.
Ginnie Mae PTAP Funding a Bit Light at $3M
May 28, 2020
Nonbank Ginnie Mae issuers increased their borrowings under the PTAP program in May but not significantly. Next up: FHA’s forbearance policy on loans in progress.
Will the New Capital Rule Impact the GSEs’ Exit from Conservatorship?
May 28, 2020
Taking a close look at the much more stringent capital norms for the GSEs, Matthew Howlett, an equities analyst at Nomura, reiterated his buy rating for Fannie Mae. The hitch? He assumes a ROE of 11.4% by 2024.

More Inside MBS & ABS

Poll

Inside Nonconforming Markets

Expanded-Credit Production Drops in First Quarter
May 29, 2020
Originations fell by 20% as the market was disrupted in March by the coronavirus. Most of the major lenders suspended production during the month, ending the quarter with declines. (Includes data chart.)
Non-QM MBS Issuance Makes a Strong Comeback
May 29, 2020
After issuance ground to a halt in March, five non-QM MBS deals came to the market in May and more are on the way. Transactions have been stocked with slightly seasoned mortgages.
Non-QM Lenders Realign Products
May 29, 2020
Among the lenders currently offering non-QMs, underwriting standards are tighter and interest rates on the loans are higher than earlier in the year. Industry participants are optimistic that the sector will rebound, eventually.
Jumbo Servicing Volume Down Slightly in First Quarter
May 29, 2020
For the first time in years, the amount of jumbo mortgage servicing outstanding declined on a quarterly basis. Looking forward, forbearance requests are a key issue. (Includes data chart.)

More Inside Nonconforming Markets

Videos

Inside Mortgage Trends

Nonbank Earnings Crushed By Unhedged MSR in 1Q20
May 22, 2020
PennyMac Financial, which hedges its MSR portfolio, reported record earnings on mortgage banking in the first quarter. Its largest competitors posted huge losses. (Includes data chart.)
Seller Buybacks of GSE Loans Spurt Higher in 1Q20
May 22, 2020
Freddie Mac continued to report significantly more repurchase activity in the first quarter of 2020 and the pipeline of unresolved claims was up from the end of 2019. (Includes two data charts.)
Impac Won’t Report 1Q Results Until Late June. Meaning?
May 22, 2020
Having hit a rocky patch during the pandemic, Impac Mortgage will be late in reporting first-quarter results and it’s selling most of its MSRs. What’s next?
Investments in Mortgage Digitization Paying Off
May 22, 2020
Lenders that made significant investments in technology in recent years reported better metrics than other players in several areas, such as origination costs and productivity.

More Inside Mortgage Trends

Inside FHA/VA Lending

GNMA MBS Program Sets Monthly Record in April
Deliveries of refinance loans into Ginnie MBS continued to climb in April, but a surge in purchase loans accounted for much of last month’s record production volume. (Includes two data charts.)
Top-Ranked FHA Lender Posts Stunning Gain-On-Sale
Even though loan forbearance is an issue that won’t go away, some FHA lenders are reporting off-the-charts profit margins. Included in that club: Mr. Cooper.
FHA Finalizing Forbearance Policy for Loans in Progress
FHA’s policy regarding mortgage insurance coverage for loans in progress isn’t quite ready. Meanwhile, Ginnie Mae’s Pass-Through Assistance Program usage remains low.
MBA Pushes for Stern FHA, GSE Forbearance Language
Legislation has been introduced in Congress to force FHA’s hand on forbearance. But will it go anywhere?

More Inside FHA/VA Lending

Premium Newsletter Content

Inside Mortgage Trends
Nonbank Earnings Crushed By Unhedged MSR in 1Q20
PennyMac Financial, which hedges its MSR portfolio, reported record earnings on mortgage banking in the first quarter. Its largest competitors posted huge losses. (Includes data chart.)
Inside Mortgage Finance
Jumbo Mortgage Market Down Significantly in 1Q20
Pandemic-related market volatility in March dampened non-agency jumbo lending more than other sectors in the mortgage business. Conforming-jumbo production also fell sharply in the first quarter but began regaining momentum in April. (Includes three data charts.)
Inside Nonconforming Markets
Expanded-Credit Production Drops in First Quarter
Originations fell by 20% as the market was disrupted in March by the coronavirus. Most of the major lenders suspended production during the month, ending the quarter with declines. (Includes data chart.)
Inside MBS & ABS
Banks Report Modest Gain in ABS Holdings in 1Q20
The top two bank ABS investors — TD Bank and Charles Schwab — pared back their holdings in 1Q, but sizable increases at Bank of America and oth-ers boosted the industry’s total position in the market. (Includes two data charts.)
Inside the CFPB
OCC’s CRA Final Rule Makes Mortgage Accommodations
The Office of the Comptroller of the Currency last week went it alone to finalize its Community Reinvestment Act overhaul. The final rule would restore the geographic distribution test for mortgage lending.
Inside The GSEs
FHLBanks’ Earnings Plunge in 1Q, Advances Surge
Borrowings by members of the Federal Home Loan Bank System increased 25.8% in the first quarter driven by COVID-19-related volatility. On the other end, the FHLBanks reported a huge drop in combined earnings with the San Francisco FHLB incurring a first-quarter loss.
Inside FHA/VA Lending
GNMA MBS Program Sets Monthly Record in April
Deliveries of refinance loans into Ginnie MBS continued to climb in April, but a surge in purchase loans accounted for much of last month’s record production volume. (Includes two data charts.)

Inside The GSEs

FHLBanks’ Earnings Plunge in 1Q, Advances Surge
Borrowings by members of the Federal Home Loan Bank System increased 25.8% in the first quarter driven by COVID-19-related volatility. On the other end, the FHLBanks reported a huge drop in combined earnings with the San Francisco FHLB incurring a first-quarter loss.
FHFA Re-Proposes Capital Rule for GSEs; Industry Skeptical
According to former Fannie Mae CFO Tim Howard, the re-proposed capital requirements are almost 40 times the average of that indicated by stress tests conducted on the GSEs last year.
More Inside The GSEs

Mortgage rates are on a bit of a roller coaster ride these days, hitting historic lows before inching back up amid an uncertain economic environment. What sort of application volume are you seeing?