Originations of non-agency jumbo mortgages in 2015 outpaced total originations, helping to increase the jumbo sector’s market share, according to a new ranking and analysis by Inside Nonconforming Markets. Fueled by bank demand, an estimated $328.0 billion in jumbos were originated in 2015, up 39.6 percent compared with 2014. Total first-lien originations increased by 33.5 percent in 2015 compared with the previous year, according to ... [Includes one data chart]
Borrower demand for jumbo mortgages declined somewhat in the fourth quarter of 2015 compared with the previous quarter, and banks plan on loosening underwriting standards for the loans, according to the Federal Reserve’s senior loan officer opinion survey. Industry participants stress that underwriting standards for jumbos remain strong, with poor performance unlikely. Senior LOs were asked to evaluate demand for purchase mortgages in the fourth quarter of 2015 ...
The Consumer Financial Protection Bureau’s disclosure rule has caused some disruptions in the non-agency market, but a number of lenders suggest that they’ve made adjustments to TRID and expect to return to business as usual. TRID disclosure requirements took effect for loan applications submitted on Oct. 3 and beyond. In the weeks after, many lenders reported longer closing timelines along with issues involving sales of non-agency mortgages due to ...
Home prices in California and other states where jumbo mortgages are concentrated are “overheating,” according to analysts at Fitch Ratings. The firm said rapid home price growth in parts of California, Florida and Texas appears to be exceeding fundamentals. Fitch estimates that homes in most major metropolitan areas in those states are currently overpriced. Grant Bailey, a managing director at Fitch, said home prices in the San Francisco area are a particular concern ...
Non-agency mortgage-backed security issuers and investors continue to work to make adjustments that will help increase activity in the market. Among the issues under discussion are representations and warranties and the use of a deal agent or transaction manager. “Industry participants are now focusing on clearly identifying which parties to a transaction are covered by the current rep-and-warrant framework, and to which activities it is applicable,” according to a recent report ...
Two Harbors Investment is focusing on jumbo mortgage conduit activities in an effort to differentiate itself from other real estate investment trusts. The REIT issued the most jumbo MBS in 2015, based on deal count, and is one of only two firms to have issued a jumbo MBS this year. Officials noted that the REIT is working to reduce its investments in agency MBS with an eye toward allocating capital to sectors with more attractive returns, including conduit operations ...
The Obama administration and Republicans in Congress recently released proposed federal budgets for fiscal year 2017, including provisions involving the government-sponsored enterprises. While both parties called for the GSEs to be eliminated, the system that will replace Fannie Mae and Freddie Mac remains a topic of intense debate, limiting prospects for action by Congress. “To finish addressing the weaknesses exposed by the financial crisis, the government must ...
AG Mortgage Investment Trust recently formed a mortgage banking platform called Arc Home. The real estate investment trust managed by a subsidiary of Angelo, Gordon & Co. said Arc Home plans to originate jumbo mortgages and non-qualified mortgages, along with FHA loans, through retail, wholesale and correspondent channels. Arc Home will be led by Barry Bier, Sandy Blitzer, Martin Schroeter and Brad Brautigam. Some of the executives ... [Includes five briefs]
FHA forward mortgage endorsements fell significantly in the fourth quarter of 2015 with a decline in purchase mortgages and an even bigger drop in refinance loans due to rising interest rates, according to an Inside FHA/VA Lending analysis of agency data. Total FHA production fell 22.2 percent from the third quarter to $58.1 billion in the fourth quarter, spurred by steep declines in purchase originations (down 21.5 percent) and refis (30.0 percent). Fixed and adjustable-rate mortgages also saw their volumes drop by 22.1 percent and 30.2 percent, respectively, during the same period. The percentage of conventional loans that refinanced into FHA loans decreased slightly. FHA baseline lending (loans below $417,000) also declined by 22.0 percent quarter-to-quarter, as did FHA conforming jumbos (loan amounts up to the statutory high-cost loan limit), which saw volume drop 24.4 percent in the fourth quarter. FHA jumbos exceeding $625,500 did not escape the carnage as production fell ...
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