The Ginnie Mae/Veterans Affairs task force is meeting regularly to find a solution to the VA churning problem that is triggering rapid prepayments to the detriment of MBS investors – and a test currently used by the FHA might provide the answer.
Three analysts at Wells Fargo Securities discussed in a new report this week what could happen to the agency MBS market as a result of pending tax reform, one version of which was passed by the U.S. House of Representatives this week. As always, the devil is in the details; hence, the bitter in-fighting among entrenched interests on Capitol Hill.
Real estate mortgage investment trusts continued to build up their agency MBS investment port-folios during the third quarter, though most REITs had a more difficult time in the less-liquid non-agency MBS market.
Conventional mortgages that meet Fannie Mae and Freddie Mac purchase guidelines remained the biggest source of new home lending during the third quarter, although other product types saw sol-id increases in origination volume as well.
The shortage of affordable homes is prompting builders to ramp up new construction, including building smaller homes, according to the National Association of Realtors.
Big changes aren’t likely to take place at the Consumer Financial Protection Bureau in the after-math of Director Richard Cordray’s surprise departure at the end of this month, but industry observers expect a significant shift in enforcement and supervision when a new leader is in place.
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