October 19, 2017

Latest from Inside Mortgage Finance

Total mortgage securities outstanding rose by 0.8 percent from the previous quarter according to estimates from Inside MBS & ABS

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Agency Servicing Continued Growing in 3Q17, But Top Banks Still Pulling Back

The universe of servicing single-family home loans for Fannie Mae, Freddie Mac and Ginnie Mae continued to expand in the third quarter, but a handful of large banks wanted little to do with it. The three agencies had a combined $6.378 trillion of single-family mortgage-backed securities outstanding at the end of September, up 1.9 percent from the midway point in the year, according to a new Inside Mortgage Finance analysis of agency MBS disclosures. All three ... [Includes two data charts]

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Big Banks Report Decent Production Figures for Third Quarter of 2017

It’s still early in the reporting cycle for third-quarter results, but major banks so far have reported solid origination gains from the previous period, but nothing to set the world on fire. In terms of percentage gains, JPMorgan Chase reported a 12.5 percent increase from the second to the third quarter. U.S. Bancorp was up 11.0 percent, Wells Fargo had a 5.0 percent gain and Citigroup reported a 3.2 percent increase. Bank of America mortgage originations were down slightly. The five ...

Brokers Voice Frustrations about ‘Whole-Tail’ Lenders: Wholesale Lenders that also have Retail Operations

Long-running tension between mortgage brokers and retail lenders with wholesale operations ratcheted up recently as a new group urged brokers to stop working with “whole-tail” lenders. Brokers Rallying Against Whole-tail Lending said it coined the term “whole-tail” lender as “a swipe at lenders that offer both wholesale and retail services on paper, when in reality, their primary business objective is to feed stolen prospect information directly to their affiliate companies.” “It is important that ...

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Inside FHA/VA Lending

Ginnie MBS Issuance Rolled To Year’s High Mark in 3Q17

Ginnie Mae issuers rode a wave of purchase-mortgage lending to deliver $120.46 billion of forward mortgages during the third quarter of 2017, the highest three-month volume for the year, according to a new analysis and ranking by Inside FHA/VA Lending. Third-quarter volume was up 9.6 percent from the April-June cycle. The data excluded FHA reverse mortgages and loan amounts are truncated in Ginnie’s mortgage-backed securities disclosures. Without those limitations, total Ginnie MBS issuance rose 9.5 percent to $123.37 billion in the third quarter. Purchase mortgages were the engine behind the growth. Ginnie issuers securitized $85.35 billion of purchase loans in the third quarter, falling just short of the record $85.41 billion set in the third quarter of last year. Although most Ginnie purchase loans (58.7 percent) were FHA loans, the biggest increase was in such loans guaranteed by the ... [Charts]

Inside Nonconforming Markets

Prime Jumbo MBS Issuance Surged In 3Q17, Nonprime Market Slowed

Issuance of prime non-agency mortgage-backed securities increased by more than 50.0 percent from the second quarter to the third, while activity in the nonprime MBS market slowed, according to a new ranking and analysis by Inside Nonconforming Markets. Some $2.97 billion of prime non-agency MBS was issued in the third quarter, up 58.1 percent from the previous period. The deals were largely backed by jumbo mortgages, along with some loans ... [Includes one data chart]

Inside MBS & ABS

Non-Agency MBS Issuance Weakened in 3Q17 Despite an Upswing in Prime Jumbo Issuance

A slowdown in new scratch-and-dent deals proved to be a drag on non-agency MBS issuance during the third quarter, according to a new analysis and ranking by Inside MBS & ABS. Total non-agency MBS production fell to $10.99 billion in the third quarter of 2017, a 29.9 percent decline from the previous period. It was the slowest quarter of 2017, although year-to-date production was still up 14.1 percent from the first nine months of 2016. The major factor was ... [Includes two data charts]

Inside the CFPB

CFPB Gives Servicers More Flexibility to Deal With Foreclosure

The CFPB last week issued an interim final rule to give mortgage servicers more flexibility to communicate with homeowners at risk of foreclosure. “Today’s action should make it easier for mortgage borrowers to receive timely information from their mortgage servicers about available options for saving their home, even if they have submitted a request to cease communication,” said CFPB Director Richard Cordray. In 2016, the bureau made changes to its rules to require servicers to send modified early intervention notices to certain borrowers at risk of foreclosure who asked for an end to communication under the Fair Debt Collection Practices Act. Under the FDCPA, borrowers can tell their servicers to stop contacting them, with some limited exceptions. Once such borrowers ...

Inside Mortgage Trends

Surging Purchase-Loan Sector in GSE Market Lifts Correspondents in 3Q17

Fannie Mae and Freddie Mac saw a huge jump in deliveries of purchase-money mortgages during the third quarter, although the first-timer share of the market fell slightly. The two government-sponsored enterprises securitized $140.75 billion of purchase mortgages during the third quarter, an increase of 26.4 percent from the previous three-month period. Purchase loans accounted for 62.9 percent of loans sold into GSE mortgage-backed securities during ... [Includes two data charts]

Inside The GSEs

GSEs See Surge in Purchase-Mortgage Business in 3Q17

Heavy purchase-mortgage business boosted Fannie Mae and Freddie Mac production of single-family mortgage-backed securities during the third quarter of 2017, according to a new Inside The GSEs analysis and ranking. The two GSEs issued a total of $223.61 billion of MBS during the three-month period ending in September, a solid 17.9 percent gain from the previous quarter. It was the strongest quarter of 2017, but production during the first nine months of the year remained 6.4 percent below the same period in 2016. Most of the gain came from the seasonal purchase-mortgage side of the business. Fannie and Freddie securitized $140.75 billion of loans used to acquire a new home, a huge 26.4 percent increase from the second quarter.

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