Acting CFPB Director Mick Mulvaney has reportedly dropped another payday lending case, giving new ammunition to his critics. According to a Reuters report, five people with direct knowledge of the matter said the CFPB under the leadership of Mulvaney decided not to go after National Credit Adjusters and is pondering whether to end cases against three other payday lenders. The agency declined to comment on the Reuters report. Mulvaney said in February the bureau won’t spend a lot of energy ...
CFPB Upgrades Mortgage Servicing Small Entity Compliance Guide. The CFPB has released version 3.1 of its mortgage servicing Small Entity Compliance Guide. The SECG provides a summary of the agency’s 2016 final mortgage servicing rule, which goes into effect April 19. The revised guide incorporates an amendment to the rule released earlier this month, which replaces the previous single-billing-cycle exemption with a single-statement exemption for mortgage servicers ... [Includes three briefs]
There aren’t many differences in quality when using an appraisal management company versus an individual appraiser, according to a new staff working paper published this week by the Federal Housing Finance Agency. Appraisal Management Companies (AMC), created to add a layer of oversight to the appraisal process, emerged as key players only after the 2008 housing crisis. The FHFA studied whether there were any systematic quality differences between AMC and non-AMC appraisals and found no evidence of such. Advocates tout AMCs as producing better quality and less biased appraisal reports, which lessens risks to lenders. But others say AMCs offer no quality assurance contribution and argue that their appraisers are less qualified.
There was a significant increase in deliveries to the GSEs of home loans with high debt-to-income ratios during the second half of 2017, according to a new Inside The GSEs analysis of Fannie Mae and Freddie Mac single-family mortgage-backed securities.The two GSEs securitized $52.90 billion of mortgages with DTI ratios ranging from 46 percent to 50 percent over the last six months of the year. That was up 72.6 percent from the first half of 2017, and the annual total was up 37.6 percent from 2016.
The GSE reform draft expected from Rep. Jeb Hensarling, R-TX, likely won’t see the light of day until sometime in mid-April, according to industry lobbyists and trade officials tracking its progress.Meanwhile, it’s safe to say some degree of apathy is setting in for the simple reason that even if a draft appears, few believe it will be bipartisan in nature, which means it will never become law, at least not in this Congress. “No one cares,” said one senior trade group official who spoke under the condition he not be identified.This official said his focus is now squarely on regulatory relief and reforming certain aspects of the...
Fannie Mae and Freddie Mac both have initiatives that link homebuyer education counselors to their automated underwriting tools to better determine a buyer’s homeownership readiness. The Federal Housing Finance Agency this week released its 2017 Scorecard Progress Report detailing work on strategic goals for the duo. Under the goal of maintaining credit access, the FHFA said the GSEs have been exploring ways to improve the effectiveness of pre-purchase and early delinquency counseling.Last month, Fannie, the Housing Partnership Network and other housing counseling agencies announced plans to develop a new client case management system. This system will connect Fannie’s automated underwriting products, Desktop Originator and Desktop Underwriter, to housing counseling agencies.
The Federal Housing Finance Agency announced plans to officially launch the “common” uniform mortgage-backed security collateralized by Fannie Mae and Freddie Mac loans on June 3, 2019. The regulator confirmed the exact date this week after previously only revealing the common security would be issued in the second quarter of 2019. The new UMBS will replace the current offerings of to-be-announced-eligible MBS and will be issued through Common Securitization Solutions, a joint venture equally owned by Fannie and Freddie. The Bethesda, MD-based CSS has been working on the project for several years now at a cost of hundreds of millions of dollars.
Servicing-released premiums on Fannie Mae and Freddie Mac whole loans sold into the secondary market are the best they have been in at least five years – and perhaps longer – thanks to higher interest rates, according to interviews conducted this week by Inside The GSEs. “We’ve seen a consistent increase in mortgage servicing rights values since early in the first quarter as a result of greater degrees of certainty for higher interest rates,” said Tom Piercy, managing director of Incenter Mortgage Advisors, Denver. “While the rate curve is not anticipated to be steep, confidence is high that rates will trend higher, hence less volatility around MSR values,” he added. “Combine this with lower production volume and we are seeing SRPs from aggregators increase.”
Freddie Mac loans under the Home Affordable Refinance Program will continue to perform better than pre-crisis mortgages, which Moody’s said bodes well for credit-risk transfers with exposure to those loans, but they will underperform more recent loans. According to an analysis by Moody’s, HARP borrowers benefited from significant payment reductions, were already showing good performance, and are likely to be more credit savvy. Freddie loans originated in 2005-07 that went through HARP had a 60-plus day delinquency rate of just 1.14 percent, as of March 2017. Moody’s said that’s well below the 6.84 percent 60-plus day delinquency rate for loans in that same period that did not go through HARP. But, the delinquency rates for HARP loans are...
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