The conditional default rate, or annualized liquidations, of non-agency MBS loans rose 20 basis points to 4.92 percent in the second quarter, after declining for seven consecutive quarters from 9.76 percent in the second quarter of 2012, Fitch Ratings reported this week. “The recent turnaround in the trend can be partly attributed to a growing portion of bank-held real estate owned properties, which typically liquidate much faster than those that are still in the foreclosure process,” said Fitch. The rate of completed foreclosures to REO property has trended higher for four consecutive quarters. The previous decline in the CDR was driven...
While affluent borrowers prefer to obtain mortgage financing from their primary bank, some in this category are willing to shop, particularly when competing lenders offer lower interest rates or more attractive loan products.
“There’s lots of talk of companies being for sale right now,” said Paul Hindman, managing director of Management Advisors Executive Search, “but not too much talk of deals closing.”
Flagstar, a thrift that is also the largest remaining depository in the table funding sector, earned $25.5 million in the second quarter compared to a $78.9 million loss in 1Q.
One critic of the report on nonbank risk had this to say: “It’s just ridiculous what they [the IG] get away with. There’s risk in every business. Don’t they get it?”
Criticisms about servicing seem to be stubbornly resistant to much improvement, however, hovering in the 3,000 to 4,000 range for the last six quarters.
The audit is being conducted by HUD’s Office of Inspector General to assess the bank’s compliance with FHA requirements related to the origination of loans insured by the agency.
“The entire subject of ‘mini-corr’ and the CFPB’s interpretation is the result of a witch hunt perpetrated by one of the lawyers that moved from the Federal Reserve Board,” said one disgruntled broker.
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