The Federal Housing Finance Agency’s proposal to shift the handling of nonperforming loans to special servicers would not benefit most servicers and borrowers, according to the Mortgage Bankers Association. The proposal could also hinder efforts to shift activity to the non-agency market. In September, the FHFA proposed a fee-for-service compensation model for the government-sponsored enterprises and suggested it could also be applied to the non-agency market. According to the FHFA’s discussion paper, Fannie Mae or Freddie Mac would pay a set dollar fee per performing loan – $10 was cited as an example. For non-performing loans ...

United Wholesale Mortgage last week announced its “The Big and Easy” wholesale jumbo program, claiming it can close loans in two weeks. “Gone are the days when an originator has to tell a borrower how difficult it is to close a jumbo loan,” said Jaime Hunt, an account executive at UWM. The loans are available for amounts up to $2.5 million for principal residences as well as second homes, for purchase or refinance. UWM is looking for borrowers with credit scores of at least 720 and loan-to-value ratios of no more than 80 percent ...

Senate Republicans have threatened to block the confirmation of Carol Galante as head of the FHA until Senate Democrats come up with a plan to deal with Fannie Mae and Freddie Mac. The Senate Committee on Banking, Housing and Urban Affairs this week voted 13 to 9 to send Galante’s nomination to the Senate floor amid Republican calls to reject the nomination. Some Republicans expressed concern over the health of the FHA Mutual Mortgage Insurance Fund, citing a recent independent actuarial study that reported a precarious drop in the fund’s excess capital reserve for unexpected losses. Sen. Jim DeMint, R-SC, said he did not think ...

The recent change in the FHA’s maximum loan limits would have relatively limited impact for current borrowers trying to refinance, according to analysts. FHA loans insured prior to Oct. 1, 2011, were already grandfathered in for streamlined refinancing regardless of loan size, said analysts with J.P. Morgan Securities. In addition, the analysts said they do not expect many conventional jumbo-to-FHA refinances in this market segment because the mortgage insurance premiums make FHA loans less attractive. Last month, President Obama signed an appropriations bill into law, reinstating the pre-Oct. 1 formula for calculating the “temporary” loan limits for high-cost areas, which is ... [With one chart]

Expenses for maintaining foreclosed properties before their transfer or conveyance are much higher for FHA than for Fannie Mae or Freddie Mac, according to a recent Government Accountability Office report. The report, which focuses on the growing number of vacant properties and the costs and challenges of maintaining them, found that FHA’s pre-conveyance reimbursements to servicers are higher than the government-sponsored enterprises’ pre-foreclosure reimbursements. In 2010, the FHA reimbursed servicers about $1,982 compared to the GSEs’ $235 per property for maintenance-related expenses prior to ...

Private mortgage insurers would play a strategic role under a new Senate proposal for winding down Fannie Mae and Freddie Mac and privatizing guarantees on high-quality mortgage securitizations. Introduced by Sen. Johnny Isakson, R-GA, the Mortgage Finance Act of 2011 would create a new regulatory framework for securitizing “qualified residential mortgages” and an alternative form of guarantee provided by a new Mortgage Finance Agency. Under Isakson’s bill, the two government-sponsored enterprises would be placed in a run-off mode by the Federal Housing Finance Agency 18 months from the date of enactment. They would be required to ...

The Department of Housing and Urban Development has proposed to create a new system that would facilitate the transfer and streamline the collection of records under the FHA’s lender approval and recertification process. The new, fully automated records system, the Lender Electronic Assessment Portal, will assume full custody and control of lender records currently maintained by the HUD/FHA Lender Approval Files System of Records Notice (SORN), which is a manual and labor-intensive process. The current system contains records of principals or officers of financial institutions who are approved or seeking approval to ...

Only state-certified appraisers can conduct appraisals of properties securing an FHA-insured mortgage under a final rule adopted recently by the Department of Housing and Urban Development. At the same time, the new rule made clear that FHA would no longer allow state-licensed appraisers to perform FHA appraisals. The FHA has not been accepting applications by state-licensed appraisers since Oct. 1, 2008, following the enactment of the Housing and Economic Recovery Act. Previous HUD regulations required that an appraiser be state-licensed or state-certified in order to be placed on the department’s official roster of appraisers. However, HERA mandated only ...

Ginnie Mae may have reported potentially inaccurate data to Congress about its exposures because estimates were not based on the best available data, according to a recent report by the Government Accountability Office. The agency’s sensitivity analysis also ignored important data, which could affect the accuracy of its cash-flow forecasts, the report said. Although Ginnie Mae has revised its cash-flow forecast model, it has not implemented practices identified in Federal Accounting Standards Advisory Board guidance and risk-budgeting guidance, the report noted. By ignoring such practices, Ginnie Mae’s model may not be ...

Ginnie Mae recently announced changes to rules implementing provisions under the Servicemembers’ Civil Relief Act for reimbursing excess mortgage interest to Ginnie Mae issuers. Under the revised SCRA reimbursement policy, issuers will be reimbursed excess interest payments on SCRA mortgage loans based on two different dates for reservists and active members of the military, said Ginnie Mae officials during an issuer outreach webinar on Dec. 8. If the borrower is a reservist, the reimbursement will be based on the date of the receipt of the deployment letter and reimbursements for active members will be based on the deployment date. Under the SCRA, mortgage lenders are required to ...