An FHA price reduction remains a possibility but its impact is likely to be limited, according to analysts at Keefe, Bruyette & Woods. While some industry observers might think another mortgage insurance premium cut is inevitable, there is no broad pressure from any group or coalition that would compel FHA to do so, said KBW analysts Bose George and Chas Tyson, both panelists at KBW’s Mortgage Finance Conference recently. Given last year’s 50-basis-point cut, the FHA’s ability to cut rates meaningfully is somewhat limited, they said. The FHA annual MIP is currently 80 to/or 85 bps, down from the pre-reduction premium of 130 to/or 135 bps and higher compared to the average annual premium of 50 to/or 55 bps before the financial crisis. If FHA decides to reduce the premium again, George and Tyson believe the floor will likely be at the pre-crisis premium level, which would suggest a ...
FHA single-family forward endorsements fell by 8.0 percent in the first quarter of 2016 from the prior quarter, suggesting a continued slowing in endorsement in the latter part of 2015 and early 2016 compared to earlier quarters, according to the FHA’s latest quarterly report to Congress on the state of the Mutual Mortgage Insurance Fund. Overall though, the FHA MMIF report as well as FHA monthly production reports for March and April continued to show the very positive trends – rising volume, lower delinquencies and outstanding credit quality – that have been occurring in the FHA program since 2009. Endorsement volume for purchase and refinance loans was down to $53.5 billion during the first three months of 2016 from $58.1 billion in the fourth quarter of 2015, the MMI Fund report showed. Last year, forward endorsements soared in the second quarter and reached a record high in the ...
FHA lenders will face stiffer maximum monetary penalties later this year for various violations of agency rules and regulations. The higher monetary penalties are the result of legislation signed into law late last year requiring federal agencies to adjust the current maximum penalty amounts for inflation in order to maintain their deterrent effect. Specifically, the Federal Civil Penalties Inflation Adjustment Act of 2015 (2015 Act) requires federal agencies to adjust the level of civil monetary penalties with an initial “catch-up” adjustment through an interim final rule and subsequent annual adjustments for inflation. The interim final rules with the initial penalty adjustments must be published by July 1, 2016. The new penalty levels must take effect no later than Aug. 1, 2016. Additionally, agencies are required to make annual inflation adjustments, starting Jan. 15, 2017, and for each year going forward. The adjustments will ...
Overture Technologies announced this week that it added support for trended credit data to its automated underwriting system for non-agency mortgages. Trended credit data detail a potential borrower’s use and repayment of revolving credit over time. “Lenders, particularly those specializing in loans to borrowers with previous bankruptcy or housing defaults, can leverage this data to understand how consumers have managed their use of ... [Includes six briefs]
The first report from the National Mortgage Database offers some details on borrowers with large loans beyond the data included in the Home Mortgage Disclosure Act. The NMDB includes information from surveys administered by the Consumer Financial Protection Bureau and the Federal Housing Finance Agency. The federal regulators survey about 6,000 new borrowers on a quarterly basis, accounting for about 0.4 percent of the population of new mortgage originations ...
The issuance of three non-agency mortgage-backed securities in quick succession suggests that industry participants have adjusted to liability posed by the Truth in Lending Act/Real Estate Settlement Procedures Act disclosure rule. Jumbo MBS from JPMorgan Chase and Redwood Trust along with a nonprime MBS from Lone Star Funds all included mortgages subject to TRID and loans with TRID exceptions. TRID was seen as a major impediment to non-agency MBS issuance ...
Performance data on nonprime mortgages originated by Caliber Home Loans in recent years suggest that it’s possible to originate loans to borrowers who don’t qualify for agency financing without experiencing major delinquencies. Caliber started originating non-agency mortgages in its portfolio loan program in the fourth quarter of 2014. None of the mortgages have been 60 or more days past due, according to a term sheet for a pending nonprime mortgage-backed security ...
Wells Fargo services more than a third of the jumbo mortgages serviced by the top 30 lenders in the sector, according to a new analysis by Inside Nonconforming Markets. Wells serviced a portfolio of jumbo mortgages with an unpaid principal balance of $268.16 billion as of the end of the first quarter of 2016. The bank’s jumbo servicing portfolio increased by 13.0 percent compared with the first quarter of 2015. The group of 30 companies handled ... [Includes one data chart]
Late this week we were hearing reports about one mortgage cooperative that was trying to strike a deal with one of the GSEs regarding pricing breaks for its members...
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