One senior mortgage manager, who has been in the business for 25 years., said despite what lenders may say about closing times, actual experience is probably worse. “No one is closing under 30 days,” he said. “Most will be over 50 days.”
The titans of the industry – the four banks with over $1 trillion in total assets – shrank their mortgage portfolios by a combined 0.5 percent over that period.
First-time homebuyer mortgages acquired by the GSEs performed worse than repeat homebuyer mortgages, said the Federal Housing Finance Agency in a new working paper. But that doesn’t necessarily mean they are riskier. Although the study found first-time homebuyers likely to face more mortgage-related challenges, the FHFA said the difference is based on demographics. “They are younger, and have lower credit scores, lower home equity, and less income and therefore are less likely to withstand financial stress or take advantage of financial innovations available in the market than repeat homebuyers,” said Saty Patrabansh, senior economist and author of the white paper. However, once these differences are taken into account he said there appears to be no difference between first-timer and repeat homebuyers in their probability of default.
Fannie Mae unveiled its second auction of nonperforming mortgages this week, $777 million of delinquent notes offered in two pools and a smaller $11 million pool that falls under its “Community Impact” program. The $11 million package includes just 75 loans. The collateral is located in Tampa, FL. The two larger pools include 3,900 mortgages. The GSE said it hopes to “inspire” nonprofits, small investors, minority- and women-owned businesses (MWOBs) and community groups to bid and then help borrowers avoid foreclosure. “We recently held a training forum to bring diverse stakeholders together to explore ways to participate in upcoming NPL sales,” said Joy Cianci, Fannie’s senior vice president for credit portfolio management.
The servicing of Fannie Mae and Freddie Mac single-family mortgages remained heavily concentrated among a relatively small number of companies, but the market continued to gradually de-consolidate during the second quarter of 2015. An Inside The GSEs analysis of new Fannie and Freddie disclosures reveals that the top five players in the market serviced 46.8 percent of securitized single-family mortgages outstanding at the end of June. At the end of the first quarter, they serviced 47.6 percent of the market. Freddie business was more concentrated – 51.0 percent of Freddie servicing was held by the GSE’s top five companies. These percentages are based on the servicing of outstanding mortgage-backed securities where a servicer is identified in MBS...
Fannie Mae completed its second credit risk- sharing transaction with the reinsurance industry this week and last week Freddie Mac introduced two new Agency Credit Insurance Structure transactions that gives it coverage based on both first loss and actual losses realized in a reference pool of residential mortgages. Under the two ACIS transactions, Freddie took insurance policies that move most of the remaining credit risk associated with the two Structured Agency Credit Risk debt notes executed in early 2015 to insurers and reinsurers. The two policies cover up to a combined maximum of approximately $223 million of losses that Freddie incurs when homeowners default. This is the 9th ACIS transaction since 2013.
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