JPMorgan Chase is shifting its mortgage production focus away from agency loans toward the jumbo market. “Our focus is on maximizing our share of high-quality originations,” Kevin Watters, CEO of mortgage banking at Chase, said last week during the bank’s annual investor presentation. He provided a slide showing Chase’s market share in terms of total originations, conventional mortgages, government mortgages and jumbo loans. As measured from ...

HUD Announces Revised Implementation Date for HECM Financial Assessment Guidance. The Department of Housing and Urban Development further delayed the effective date of new guidance requiring a financial assessment of Home Equity Conversion Mortgage loan applicants. Issued in November last year, the new guidance becomes effective for HECM case numbers issued on or after April 27, 2015. The FHA said the change was due to a delay in efforts to align vendor software with HUD software to get the system up and running. Last month, HUD moved the guidance’s implementation date to March 2. The guidance requires lenders to evaluate borrowers’ willingness and capacity to meet their HECM obligations and to comply with program requirements. HUD Aligns QM Points-and-Fees Limit to Newly Recalculated CFPB Standards. The Department of Housing and Urban Development has aligned the points and fees limit under its qualified-mortgage rule to the ...

Endorsements of FHA-insured reverse mortgages jumped 31.7 percent in the fourth quarter of 2014 from the previous quarter with purchase HECMs accounting for more than 22 percent of the total. On the other hand, endorsements were down 9.1 percent year-over-year because of new restrictive HECM rules that were implemented last year. Endorsements totaled $13.9 billion for the year. All top five HECM lenders posted sequential gains. Leader American Advisors Group had a 12-month total of $2.0 billion, representing 14.7 percent of the market. Second-ranked Reverse Mortgage Solutions closed out the year with $1.0 billion in total endorsements and a 7.4 percent market share. One Reverse Mortgage, Liberty Home Equity Solutions and Proficio Mortgage Ventures comprised ... [1 chart}

CORRECTION: The jumbo share of total originations in 2014 hit the highest level seen since 2002, not since 2003, as reported in the Feb. 20, 2015, issue of Inside Nonconforming Markets. A New York appeals court approved a long-disputed $8.5 billion settlement this week involving Bank of America and non-agency mortgage-backed securities issued by Countrywide Financial. If no further appeals are brought, investors in the deals ... [Includes seven briefs]

Although the new rules for surviving spouses of borrowers with FHA-insured reverse mortgages address many of the issues raised by non-borrowing spouses, some questions remain unanswered, according to legal experts. The guidance in Mortgagee Letter 2015-03 provides insufficient answers to the issues it was meant to address, said Robert Couch, a partner with the Birmingham, AL, law firm of Bradley Arant Boult Cummings and former general counsel at the Department of Housing and Urban Development. Servicers should take note of those issues and seek further clarification, he said. Issued on Jan. 29, the guidance provides a way for lenders to proceed after a borrower with a Home Equity Conversion Mortgage loan dies and is survived by a non-borrowing spouse. It allows a lender to assign to HUD HECMs that are in default due to the death of the borrower, as long as certain ...

Moody’s Investors Service started using new criteria to rate prime non-agency mortgage-backed securities at the end of February. As part of the new criteria, the rating service is allowing non-agency MBS issuers to have access to the tool used to estimate Moody’s initial calculation of triple-A stress loss for a potential security. Moody’s Individual Loan Analysis model, known as MILAN, will be the main quantitative tool for collateral analysis by ...

The FHA bucked a decreasing delinquency-rate trend for all other types of loan by posting an increase in past-due loans during the last three months of 2014, according to the Mortgage Bankers Association’s latest national delinquency survey. On a seasonally adjusted basis, the overall delinquency rate fell 17 bps for all loan types to 5.68 percent, MBA data showed. Data compiled by the Inside Mortgage Finance Large Servicer Delinquency Index also showed a sizeable decline of 32.7 basis points in the fourth quarter from the prior quarter. The 24 servicers covered by the index had a delinquency rate of 6.34 percent in the fourth quarter, down from 7.59 percent in the same period the prior year. The IMF data are not seasonally adjusted. In contrast, the FHA delinquency rate rose to 9.73 percent in the fourth quarter, up 4 bps from the previous quarter, according to the MBA. On the other hand, loans with a ...

The Federal Housing Finance Agency released requirements that will likely pave the way for increased sales of nonperforming mortgages by Fannie Mae and Freddie Mac. The FHFA said it has approved of sales of nonperforming loans by the government-sponsored enterprises to reduce the number of severely delinquent loans held in their inventories and to transfer risk to the private sector. Freddie has completed two sales of nonperforming ... [Includes one data chart]

Strong investor demand continues to make whole-loan sales more profitable than securitization, according to Redwood Trust officials. “Throughout 2014, whole-loan buyers provided better pricing and execution for our jumbo home loan sales versus securitization,” said Brett Nicholas, president of the real estate investment trust, during the company’s fourth-quarter earnings call. He said Redwood expects strong demand for jumbo loans in the first part of ...

Issuers of jumbo mortgage-backed securities offered investors variety in two deals that closed last week and an MBS planned for next week. Separate jumbo MBS from WinWater Home Mortgage and FirstKey Mortgage were issued on Feb. 27. The $372.36 million WinWater Mortgage Loan Trust 2015-2 included two non-qualified-mortgages. Debt-to-income ratios above 43 percent caused the two loans to be deemed non-QMs, according to Standard & Poor’s ...