As summer approaches, the mortgage mergers-and-acquisitions market is heating up – with mostly talk. However, soon that chatter may lead to actual deals. According to investment banking sources, at least three mid-sized nonbanks may pull the exit parachute soon, with offering books ready to follow. The identity of the three firms was not provided, but the firms are well known, said one source. Meanwhile, the list of possible buyers hasn’t changed...
There wasn’t much mention of the interpretation and enforcement of the Real Estate Settlement Procedures Act during oral arguments this week before the U.S. Court of Appeals for the District of Columbia Circuit in PHH Corp. v. Consumer Financial Protection Bureau. Instead, nearly all of the discussion revolved around constitutional questions. The biggest issue was about just how much power to “faithfully execute” the laws of United States the president is left with if the only way to remove the head of a single-director agency is “for cause.” The other constitutional issues that garnered some attention were...
An uptick in mortgage interest rates has reduced rate-term refinance volume but demand from borrowers for cash-out refis and home-equity loans appears to remain relatively strong. “When we look at the landscape for home-equity extraction, we see potential tailwinds from loan-to-value ratio and credit curing combined with slightly less stringent lending standards helping bolster borrower demand,” analysts at Wells Fargo Securities said in a report last week. Borrower LTV ratios have been helped...
House Financial Services Committee Chairman Jeb Hensarling, R-TX, author of H.R. 10, the Financial CHOICE Act, this week expressed uncertainty about how much of his controversial alternative to the Dodd-Frank Act might be able to garner bipartisan support in the Senate. But he said he is hopeful and willing to negotiate anything, while articulating faith in a strategy that pushes both a “short game” and a “long game” when it comes to making the major changes he envisions. During a public policy discussion at the American Enterprise Institute, a conservative think tank in Washington, DC, Hensarling suggested that Democrats haven’t stepped up to the plate to help smaller banks. “I hear my friends on the other side of the aisle say nice things about wanting to do regulatory relief for community financial institutions,” the congressman replied. “But I just never see the legislation. I don’t quite see the follow-through. “I haven’t given up...
Fannie Mae recently completed its first single-family rental securitization deal with a large institutional investor and the Urban Institute said demand for SFR financing is likely to grow. The $1 billion deal with Invitation Homes was announced in January as a pilot program. The Dallas-based company is the largest single-family rental operator in the U.S. and has a portfolio of about 50,000 homes that it acquires from foreclosures. As investors increasingly rely on leverage to earn an acceptable rate of return, these kinds of transactions are expected...
A split in court rulings in cases involving “super-priority” liens makes the issue ripe for consideration by the Supreme Court of the United States, according to industry trade groups. Last week, the Mortgage Bankers Association, the American Bankers Association and the U.S. Chamber of Commerce submitted a joint amicus brief to the Supreme Court, stressing that super-priority liens “eviscerate” the traditional standing of mortgages. The court case of interest to the trade groups is...
The Federal Home Loan Banks have become too reliant on short-term funding of longer-term assets, according to Federal Housing Finance Agency Director Mel Watt. Speaking at the FHLBank Annual Director’s Conference this week, Watt reiterated his concern from a year earlier that over time a heavy reliance on short-term funding can strain the system’s capacity to issue short-term debt at attractive spreads. He acknowledged...
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