Citadel Servicing Corp. and Angel Oak Companies – two of the most active nonprime lenders operating today – are looking at record originations for the second quarter and all of 2017. But don’t expect a torrent of conventional lenders to jump into the space anytime soon. According to interviews conducted by Inside Mortgage Finance in recent weeks, there’s plenty of interest in the “new” subprime market, a business predicated on sober loan-to-value ratios and rigorous underwriting, but most conventional lenders do not see it as safe. At least not yet. “Right now, there’s...
With interest rates projected to rise, lenders are putting an increased emphasis on purchase mortgages. A little-used feature in post-crisis originations could help boost purchase-mortgage originations: temporary interest rate buydowns. A temporary buydown can help increase a lender’s “market potential” by offering borrowers lower initial payments and the stability of predictable payment increases, according to Freddie Mac. Temporary buydowns generally last...
Almost every week it seems like a lender launches a digital mortgage process allowing for loan applications to be received and processed online effortlessly and efficiently. However, according to a recent survey of lenders, a number of barriers stand in the way of digital mortgages. Lenders cited various technology issues, costs and difficulties getting loan officers to change behavior as barriers to digitizing the mortgage process. Some 73 lenders participated in the survey administered by the Strategic Mortgage Finance Group earlier this year. The top barrier to digital mortgage offerings was...
The Federal Housing Finance Agency wants to know how Fannie Mae, Freddie Mac and the Federal Home Loan Banks can better help borrowers with limited English proficiency (LEP) throughout the entire mortgage cycle, from lending to servicing. With the numbers of individuals not able to speak English fluently growing in the U.S., the FHFA wants to learn more about some of the procedures and tools that originators, servicers, and other parties in the mortgage lending process currently use to help LEP borrowers. To better understand the challenges, the FHFA issued...
The Consumer Financial Protection Bureau is destined for major changes whether they come via the federal courts or Congress, but which one has the bigger impact on the agency’s future is a question that seems to divide industry attorneys. In an analysis, Jerome Walker, a bank regulatory compliance attorney with the Duane Morris law firm in New York, writes it is likely that courts are a greater threat to the CFPB at this point than Congress. Although the House Financial Services Committee has approved legislation that would make major changes at the bureau, the legislation’s future in the Senate is uncertain. “Recent court cases, however, have proven...
The GSE patch expires either in January 2021, seven years after the effective date of the ATR rule, or when the GSEs are taken out of conservatorship, whichever comes first…
Commenting on the latest revelation from Walter, Keefe, Bruyette & Woods said, “Given the lack of visibility, we maintain our underperform rating and $1 price target.”
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