An entity affiliated with Ocwen Financial and Walter Investment Management separately initiated financing schemes around the time the two companies joined to bid on the mortgage assets of the bankrupt Residential Capital. Ocwen and Walter last week won a ResCap auction with a joint bid of $3.0 billion, including $540.0 million from Walter. The companies noted that ResCap was servicing $374 billion in unpaid principal balance as of the end of the first quarter of 2012, including a significant amount of ...

Mortgage brokers have made a comeback and a number of new buyers have stepped into the correspondent market – with the common theme of a stronger focus on loan quality. Wholesale lenders have become more selective, said Matthew Young, a senior vice president at Genworth Mortgage Insurance, during a panel session at the Mortgage Bankers Association annual convention in Chicago last week. Buyer attitudes in the correspondent market have been shaped by the risk of mortgage buybacks, which have led to ...

Regulations arising from the Dodd-Frank Act and Basel III capital standards would result in fewer mortgage loans made, tighter lending standards, reduced home sales, fewer jobs and slower economic growth, warned a new study from the American Action Forum, a policy think tank in Washington, DC. In particular, the AAF said that taken as a whole, the finalized rules on qualified mortgages and qualified residential mortgages,as well as Basel provisions requiring banks to hold more capital for certain risk-weighted ...

Independent mortgage companies could lose access to warehouse funding or at least face significantly higher costs if Basel III capital requirements are implemented as proposed, according to the Mortgage Bankers Association. The capital requirements proposed by federal regulators would change the definition of “financial collateral” included in proposed standardized approach rules by excluding conforming residential mortgages. “This change would significantly reduce the amount of funding available to non-depository mortgage bankers since the warehouse lines ...

Mortgage lenders reported solid increases in loan originations during the third quarter of 2012, leading to a surge in securitization activity at Fannie Mae and Freddie Mac. Single-family mortgage originations totaled $475.0 billion during the third quarter, according to a new Inside Mortgage Finance analysis. That was up 9.2 percent from the second quarter of the year and marked the highest quarterly origination volume since the end of 2010, when an earlier refi surge pushed production to $520.0 billion. The strong third quarter suggests...[Includes two data charts]

Valuations of mortgage servicing rights could take a severe beating if scores of banks dump MSRs to avoid costly new capital requirements under rules to implement controversial international guidelines that have been proposed by U.S. banking regulators. Proposals to implement the Basel III capital rules for U.S. banks would be a game-changer for the mortgage industry, said David Motley, president of Colonial National Mortgage, during a panel session at the Mortgage Bankers Association annual convention last week. As proposed, the Basel III rules “would restrict our ability to grow and may cause us to shrink,” he said. The complex set of Basel III proposals would affect...

Officials at National Mortgage Insurance say a state-of-the-art business platform and a somewhat old-school approach to writing private MI will help the company establish a beachhead in an industry that’s seen three long-time players washed out to sea by the housing market collapse. National MI hopes to have its Fannie Mae and Freddie Mac approvals within the next few months, and it’s made significant headway in lining up state approvals, officials say. In June, the new private MI was approved for an accelerated licensing process that allows it to seek multiple state licenses on a streamlined basis. The private MI industry has seen...

The use of conventional conforming mortgages in the home purchase market, which fell to the lowest level in more than a decade last year, is staging a comeback in 2012. A combination of events – particularly increased home buying by higher-income current homeowners and more attractive pricing for higher loan-to-value ratio conventional financing – appears to be fueling the growth. Perhaps the most visible sign of the growth in the conventional side of the home purchase market can be found in Fannie Mae’s and Freddie Mac’s latest mortgage activity numbers. According to data compiled by Inside Mortgage Finance, the combined home purchase mortgage business of Fannie and Freddie climbed to $77.6 billion in the third quarter of this year. That was not only up 33.6 percent from the second quarter’s volume, but put...

Fannie Mae and Freddie Mac could repay the U.S. Treasury faster than previously forecast, according to updated projections of potential draws for the two government-sponsored enterprises issued last week by the GSEs’ conservator. According to the Federal Housing Finance Agency, Fannie and Freddie are expected to draw between $191 billion and $209 billion from Treasury by the end of 2015. This year’s “reduced and more stable” projection by the FHFA is lower than the previous estimate made only a year ago, which offered a range of between $220 billion and $311 billion for total support through the end of 2014. “The key drivers of those results include...

An auction last week for about $374.0 billion in mortgage servicing and the origination platform of bankrupt Residential Capital ended with Ocwen Financial and Walter Investment Management as joint winners – along with some drama. Walter appears to have been brought into Ocwen’s bid due to concerns about offshore servicing, while Nationstar Mortgage, the loser in the auction, claims the firms paid too much for the assets. Special servicers Ocwen and Walter won...