It was the biggest volume of new lending above the conforming loan limit since the second quarter of 2007 – before “emergency” conforming loan limits were authorized by Congress.
The $11.6 billion deal resolved Fannie's long-standing claims that BofA sold the GSE defective mortgages and mishandled various loans it serviced for Fannie between 2000 and 2008.
Cerberus Capital is contemplating purchasing additional mortgage banking firms. Meanwhile, the CFPB doesn't like what it sees in the servicing space when it comes to customer service.
With Fannie lowering its LTV maximum it will reduce the pool of eligible GSE borrowers and likely shift those loans over to FHA, which means private mortgage insurance firms will lose business.
On a combined basis, the nine lender/servicers tracked by Inside Mortgage Trends generated $243 billion in single-family mortgages during the second quarter, a little less than half the entire market.
As feared by the residential finance industry, an increase in upfront mortgage insurance premiums is hurting participation in the FHA program by first-time buyers.
The CFPB, HUD and the Department of Justice have all gone on record asserting that disparate impact claims are viable under the Fair Housing Act and the Equal Credit Opportunity Act.
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