The mortgage lenders that will thrive in the future will be those that lead the market’s charge toward “frictionless” originations, according to a recent white paper from Oracle Financial Services, a division of the global technology provider. The key for lenders is to re-invent their processes and adopt digital-based customer-centric originations in order to improve efficiency, reduce cost and enhance the borrower experience.“The correlation between process and profitability is ...

For most of the year, it’s been an unpleasant ride for the nation’s mortgage insurers: Ugly share price performance, lower revenues (though not awful), and the fear that any day now the FHA might lower its premiums and cut into private MI market share. But over the past few weeks, policy winds in Washington have shifted with analysts rethinking the short-term prospects for the sector. According to a recent report from FBR & Co., “policy ... [Includes one data chart]

Great Britain’s exit from the European Union has triggered a drop in mortgage rates that will have significant effects on the U.S. mortgage market, according to a recent analysis by the Urban Institute. UI’s analysis attributed the mortgage-rate drop to a decline in the 10-year Treasury rate, which fell from 1.74 percent. The rate fell to 1.46 percent on the day after the vote. The more capital continues swarming toward the safety of 10-year T-notes, the lower rates would fall ...

Younger loan applicants tend to have worse credit characteristics, but they also have more potential for higher earnings, according to a new analysis by CoreLogic. The firm recently provided details on the characteristics of loan applications by Millennials (born 1981 to 1997), Generation X (1965 to 1980), Baby Boomers (1946 to 1964) and the Silent Generation (1928 and 1945). The data covered loan applications in March, April and May. Generally, the younger applicants ...

Fannie Mae and Freddie Mac both saw substantial increases in single-family volume during the second quarter, aided in part by nonbank sellers scouring for refinance business. But Fannie enjoyed bigger gains, while Freddie’s share of the two-horse GSE market slipped to 39.5 percent. Freddie’s share has hovered above 40 percent for the past two years, and it was 40.2 percent for the first six months of the year, but the GSE has to prop up its share by charging lower guarantee fees and through other means. In 2016, Freddie has been getting a smaller share of some sellers’ business than it got in the first half of last year. [includes two data charts]

Sen. Bob Corker, R-TN, and Mark Warner, D-VA, wrote Federal Housing Finance Agency Director Mel Watt urging him to avoid taking steps that would lead to the GSEs’ release from conservatorship without comprehensive reform. The letter, sent on July 7, argued that doing so would perpetuate the pre-crisis practice of pubic losses and private gains. Senator Mike Crapo, R-ID, Heidi Heitkamp, D-ND, Dean Heller R-NV, and Jon Tester, D-MT, also coauthored the letter. They agree that an overall change to the existing structure needs to take place, but warned that it should only come through housing finance reform legislation and not any unilateral action by the administration.

In a rare decision, the U.S. Supreme Court last week agreed to hear oral arguments pertaining to an ongoing Fannie Mae foreclosure case dating back to 2002. The case, Crystal Monique Lightfoot v. Fannie Mae, Cendant Mortgage Corp., is based on whether individual homeowners have the right to sue the GSE in the state courts after being wrongly foreclosed on by Fannie. Two homeowners from California involved in a mortgage dispute originally sued Fannie in state court back in 2002. But Fannie said the case should automatically fall under federal jurisdiction and be moved to the U.S. District Court of the Central District of California.

Fannie Mae and Freddie Mac have sold 41,649 nonperforming loans through May 2016, according to the Federal Housing Finance Agency’s inaugural report on nonperforming loan sales and borrower outcomes. The report, released last week, is the first of two reports the FHFA plans to publish each year highlighting NPL sales activities. The loans had an aggregate unpaid principal balance of $8.5 billion and were delinquent 3.4 years on average. Freddie led the NPL sales market for the GSEs having sold 26,436 delinquent loans. Fannie was a distant second at 15,213. The average loan-to-value ratio was 98 percent. LSF9 Mortgage Holdings and Pretium Mortgage Credit Partners were the top...

Former Federal Housing Finance Agency Director Ed DeMarco said the GSEs should operate as lender-owned entities that sell insurance against borrower defaults. DeMarco, along with Michael Bright, director of the Milken Institute’s Center for Financial Markets, published the housing reform plan last week. They said a long-term housing finance decision is needed. “Meaningful reform must be achieved, the vast majority of policymakers say, yet the decade anniversary of the conservatorships of Fannie Mae and Freddie Mac looms,” they said. “The FHFA was never envisioned as the permanent manager of the enterprises.” DeMarco and Blight suggest turning the GSEs into mutual insurance companies. In this scenario...

Freddie Mac expanded its re-performing loan program by introducing its first structured sale of seasoned loans last week. The $199 million pilot structured sale is comprised of seasoned loans that Freddie currently guarantees and holds in its portfolio. This includes option adjustable-rate mortgages as well as loans that were originally option ARMs but have been modified through a Home Affordable Refinance Program or other modification. Most of the loans are” less than six months current” or are moderately delinquent, according to Freddie. The transaction involves two steps. In the first step, Freddie sells the loans through a competitive bidding process, subject to a securitization term sheet.