Thanks to the Federal Reserve’s aggressive support for the agency mortgage market and continuing strength in the refinance program for underwater Fannie Mae and Freddie Mac borrowers, mortgage refi activity has accounted for 73.1 percent of 2012’s surging production volume. But home-purchase lending started to regain some market share during the third quarter of 2012, according to a new Inside Mortgage Finance ranking and analysis. An estimated $143 billion of home-purchase mortgages were originated during the third quarter, up 10.9 percent from the previous three-month period. By comparison, refinance production was up just 2.8 percent from the second quarter. The purchase-mortgage sector still has...[Includes three data charts]

The state of emergency in the U.S. mortgage market lives on for another year, as the Federal Housing Finance Agency announced that conforming loan limits will remain as they are for 2013. The agency didn’t have much say in the matter, since Congress in late 2011 extended the “emergency” loan limits for Fannie Mae, Freddie Mac and the FHA through the end of 2013. Lawmakers did lower the top Fannie/Freddie loan in high-cost markets of the lower 48 states to $625,500, while the top-end FHA loan is still $729,750. Although the FHA has not yet announced...

The mortgage finance industry is getting antsy because the much-anticipated ability-to-repay final rule still has yet to be released by the Consumer Financial Protection Bureau, even though it was widely expected to come out after the election, perhaps by Thanksgiving. The bureau does not have a specific release date yet, but officials still expect it to happen before the statutory deadline of Jan. 21, 2013. Lenders are pretty amped up...

Congress needs to quit pickpocketing Fannie Mae and Freddie Mac by diverting guaranty fees from the government-sponsored enterprises to pay for purposes unrelated to housing or risk derailing the fledgling housing market recovery, warn industry groups. The House last week approved H.R. 1629, the STEM Jobs Act of 2012, which would provide visas for qualified workers in the fields of science, technology, engineering and mathematics (STEM). A manager’s amendment after the bill was sent to the House Rules Committee tacked on a “payfor” requiring the GSEs to increase their g-fees to cover the cost of implementing the bill. “We appreciate...

The Federal Housing Finance Agency has perhaps overreached in its efforts to develop a post-Fannie Mae and Freddie Mac secondary mortgage market infrastructure as industry groups say the agency’s proposal is “laudable” but rife with unintended consequences. In September, the FHFA in a white paper proposed a framework for both a common securitization platform and a model pooling and servicing agreement with a request for public comment. The proposed infrastructure has...

Banks that have successfully increased their market share of mortgage originations have leveraged existing customer relationships and focused on mortgage processing, according to industry analysts. Cost is an important factor for borrowers, but service and product offerings also play a role. “Lenders must align account-opening channel preferences to customer needs to increase loan applications and achieve their revenue growth and retention goals,” Craig Focardi, a senior research director at Corporate Executive Board TowerGroup, said during a recent webinar hosted by his firm. In the past year, significant gains in market share have been posted...

Department of Housing and Urban Development Secretary Shaun Donovan said this week HUD is considering additional steps to improve the financial health of the FHA single-family program, including raising FICO score requirements and supporting legislation that would take the FHA loan limits back to pre-crisis levels. The HUD secretary found himself in the hot seat before the Senate Committee on Banking, Housing and Urban Development, explaining the results of a recent actuarial audit that placed the FHA’s Mutual Mortgage Insurance Fund capital reserve ratio below zero at negative 1.44 percent, representing a negative economic value of $16.3 billion. Sen. Richard Shelby, R-AL, ranking minority member of the committee, raised...

Commercial banks and savings institutions continued to increase their MBS holdings during the third quarter, despite more competition for the still-shrinking asset class. A new Inside MBS & ABS analysis of bank call report data shows that banks and thrifts held a record $1.617 trillion of residential MBS as of the end of the third quarter, up 0.5 percent from the previous quarter. All of the growth came from commercial banks, as thrift MBS holdings continued to decline, dropping 1.3 percent to $175.6 billion. Banks managed to increase...[Includes two data charts]

A three-judge federal panel this week heard a rare interlocutory appeal by one of the defendants in a series of lawsuits that the Federal Housing Finance Agency has filed in connection with non-agency MBS purchased by Fannie Mae and Freddie Mac. Lawyers for UBS Americas argued before the Second Circuit Court of Appeals that it should reverse the May ruling by Manhattan Federal Judge Denise Cote denying the bank’s motion to dismiss the FHFA’s lawsuit as time-barred under the statute of repose. The FHFA sued...

New York Attorney General Eric Schneiderman said he plans to file more lawsuits against non-agency MBS issuers using the Martin Act, which allows platform-wide cases as opposed to cases focused on specific deals. “It’s not about one deal or five deals or 10 deals, it’s about the entire course of conduct,” he said last week after filing a platform-wide lawsuit against Credit Suisse Securities. The lawsuit was filed as part of the RMBS Working Group’s efforts, including a similar lawsuit Schneiderman filed in October against JPMorgan Chase. “The actions you have seen...