Fannie Mae’s delay in releasing its 2012 earnings underscores the sharp turnaround in the con-servatorships of the two government-sponsored enterprises, which lately have begun spewing earnings like the good old days.Freddie Mac, which managed to get its reporting done on time, recorded a whopping $16.0 bil-lion in net income last year, and there’s widespread speculation that Fannie Mae will beat that mark with room to spare.
President Obama and other supporters of the Consumer Financial Protection Bureau won an ex-pected victory this week as the Democrat-controlled Senate Banking, Housing and Urban Affairs Committee approved, on a 12-10 party-line vote, the nomination of Richard Cordray to be the director of the bureau for a full five-year term.
Members of the House and Senate on both sides of the aisle are working on legislation to reform the mortgage finance system, but partisan differences suggest that the most likely accomplishment may be steps aimed at not making the difficult task any harder.In the Senate, a handful of members from both parties recently introduced the “Jumpstart GSE Reform Act,” which would prevent guaranty fees collected by the government-sponsored enterprises from being used to offset other government spending.
Even though mortgage applications are beginning to wane, competition for loan officers remains strong with certain growth-minded nonbanks aggressively courting high performers from such places as Bank of America, SunTrust and Wells Fargo, according to interviews conducted by Inside Mortgage Finance over the past few weeks.
Financial trade groups are backing bipartisan legislation introduced in the House that would modify the definition of points and fees in the Dodd-Frank Act ability-to-repay and “qualified mort-gage” provisions. Introduced by Rep. Bill Huizenga, R-MI, and backed by seven bipartisan cosponsors, H.R. 1077, the Consumer Mortgage Choice Act, would amend the DFA’s points-and-fees definition to avoid shutting out low and moderate-income borrowers from the QM market.
Last summer, the Office of the Comptroller of the Currency issued an advisory concerning warehouse lines of credit that was all but ignored by most players in the market. That is, until now. In a research note, Keefe, Bruyette & Woods said the “new” OCC rules could force Texas Capi-tal Bank to increase the risk weighting of its warehouse lines to 100 percent, from its current designa-tion of 37 percent.
Look for Fannie Mae and Freddie Mac to continue to increase their guaranty fees, but the current level of g-fees is approaching “striking distance” of the threshold expected in a competitive private market, the head of the Federal Housing Finance Agency told lawmakers this week.Testifying before the House Financial Services Committee, FHFA Acting Director Edward De-Marco said last year’s two 10 basis point g-fee increases raised the average fee to around 50 bps, double where they were when the GSEs were put in conservatorship in September 2008.
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