All three agencies posted big increases in multifamily MBS issuance last year, with Freddie (up 65.4 percent) and Fannie (up 36.4 percent) leading the way…
The turmoil in financial markets around the world is fueling a flight to safety on the part of investors into U.S. dollar-denominated assets, helping to keep mortgage rates in the U.S. housing market lower than they otherwise would be. But how long that will continue is anyone’s guess. “The recent volatility in worldwide financial markets caused Treasury rates to decline, so we’ve seen that being picked up in mortgage rates,” Danielle Hale, managing director of housing statistics for the National Association of Realtors, told Inside Mortgage Finance. Mike Fratantoni, chief economist at the Mortgage Bankers Association, said...
A battle on the legislative or even legal front may be brewing that challenges the Federal Housing Finance Agency’s recent decision to exclude certain types of insurance companies from membership in the Federal Home Loan Bank system. The biggest impact of the final rule would be to force a number of real estate investment trusts that have formed captives to gain access to the FHLBanks to give up low-cost FHLBank advances. “The impact on mortgage liquidity and credit access should be...
The mortgage industry’s continued use of marketing services agreements and other affiliated business arrangements hangs in the balance in a long-running dispute between PHH Corp. and the Consumer Financial Protection Bureau, which will be the subject of oral arguments April 12, 2016, before the U.S. Court of Appeals for the District of Columbia. “The PHH appeal is one of the most important Real Estate Settlement Procedures Act opinions to be decided by the courts in decades,” legal expert Phillip Schulman told Inside Mortgage Finance this week. “It will determine whether Section 8(c)(2) of the act merely clarifies the Section 8(a) anti-kickback provisions of the statute, as CFPB Director Richard Cordray claims, or whether it creates a safe harbor that exempts payments from a RESPA violation if those payments are for goods provided or services rendered, as the plain language of the act and several previous circuit courts have held.” Further, “This appeal will have...
Bowing to pressure from investors – in particular, Carl Icahn – American International Group this week rolled out a blueprint to increase shareholder value, including a partial spin-off of its top-ranked mortgage insurance division, United Guaranty Corp. Although both AIG and UGC were not entertaining questions on the details, a spinoff of the MI business could come by mid-year with up to 19.9 percent of the unit being sold to the public. Eventually, AIG said...
Mortgage Guaranty Insurance Corp. will readjust its current premium rates to meet its modest return-on-equity goal and achieve limited growth in its insurance-in-force in 2016, but whether this will precipitate similar moves across the private mortgage insurance industry remains to be seen. In announcing the company’s fourth quarter 2015 results, Patrick Sinks, chief executive officer of MGIC Investment Corp. and Mortgage Guaranty Insurance Corp., disclosed plans to revise premium rates to “generate comparable returns” across the spectrum of loans the company insures. MGIC expects...
Existing home sales increased by 14.7 percent in December compared with the previous month, according to data from the National Association of Realtors, suggesting that issues involving the Consumer Financial Protection Bureau’s disclosure rule were temporary. NAR said 5.46 million sales of existing homes were completed in December, on a seasonally adjusted basis, up from 4.76 million the previous month, marking the largest monthly increase ever recorded by the group, on a percentage basis. Existing home sales in November were down by 10.5 percent from the previous month as lenders grappled with the new TRID disclosure rule. “While the carryover of November’s delayed transactions into December contributed greatly to the sharp increase, the overall pace taken together indicates...
With nonbanks fearing they could be stuck with error-laden mortgages that violate the integrated disclosure rule, a secondary market has developed for this new breed of “scratch and dent” loans, according to interviews conducted by Inside Mortgage Finance. One investor, requesting his firm’s name not be identified, said his shop bought such a mortgage for 90 cents on the dollar. Participants in the market – including investors and traders – concede...
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