Ginnie Mae servicers continued to experience modest increases in servicing outstanding while FHA servicers reported a slight increase in 30-to-60 day delinquencies, according to Inside FHA Lending’s analysis of the agencies’ servicing portfolios as of midyear 2013. As of June 30, Ginnie Mae’s total servicing outstanding was $1.4 trillion, an increase of 6.6 percent from last year and up 1.8 percent from the first quarter, reflecting improvements in government-backed loan originations due to a slowly recovering economy. Ginnie Mae servicing volume has been ... [2 charts]

The Department of Housing and Urban Development has updated its lender requirements for preforeclosure sale (short sale) and deed-in-lieu of foreclosure for implementation on Oct. 1 this year. The short sale or deed-in-lieu of foreclosure are the last options available to a distressed borrower if home-retention options, such as special forbearance, loan modification, partial claim, and FHA’s Home Affordable Modification Program are not successful. A short sale allows the borrower to avoid foreclosure by selling the home for less than the loan balance. The lender recovers the remainder from ...

The FHA is trailing Fannie Mae, Freddie Mac and the Department of Veterans Affairs in the disposition of real estate-owned properties, according to a new study from the Government Accountability Office. The study found that FHA’s net proceeds from REO sales from January 2007 through June 2012 were about 4 to 6 percentage points lower than Fannie’s and Freddie’s returns. The differences in combined returns between FHA and the government-sponsored enterprises persisted at an estimated 2 to 5 percent even after controlling for differences in value, location, market conditions and other relevant factors. In addition, the FHA took about ...

A former FHA commissioner said he supports a proposal in the Protecting American Taxpayers and Homeowners Act (PATH Act) to spin off the FHA from the Department of Housing and Urban Development as an independent government-owned corporation. Brian Montgomery, who was assistant secretary for housing and head of the FHA during the Bush administration, said the separation, if enacted, would transfer authority, resources and personnel from HUD to the FHA to manage the insurance fund. “This is something I have advocated both during and after my more than four-year tenure as FHA commissioner,” said Montgomery, who ...

FHA officials, industry groups and consumer advocates appear to be leaning more towards a Senate FHA reform bill that is moderate and far less ambitious than legislation approved by the House Financial Services Committee this week. Introduced by Senate Banking Committee Chairman Tim Johnson, D-SD, and Ranking Minority Member Mike Crapo, R-ID, the FHA Solvency Act of 2013 “focuses on the right issues, not like the House bill, which tries to dramatically alter the program and affect borrower eligibility,” said an industry observer. Testifying as the sole witness at a Senate Banking Committee hearing on FHA solvency this week, FHA Commissioner Carol Galante said ...

Several provisions in FHA solvency legislation are emerging as potential hot-button issues for lenders, according to legal experts. There is growing industry concern over indemnification provisions, which appear to be more stringent in the Senate’s FHA Solvency Act of 2013 than in H.R. 2767, Protecting American Taxpayers and Homeowners Act (PATH Act), which the House Financial Services Committee passed this week. Under Title II (FHA reform) of the PATH Act, a lender may be required to indemnify the FHA if the agency determines that ...

The House Financial Services Committee this week reported out a legislative package of housing finance system reforms, including measures designed to reduce FHA’s role in the mortgage marketplace, strengthen lender oversight and avoid a potential taxpayer bailout. The bill, Protecting American Taxpayers and Homeowners Act (H.R. 2767), passed by a vote of 30 to 27 despite mixed responses from industry experts, academics, financial trade associations and consumer advocates. Critics called for changes. Offered by Rep. Jeb Hensarling, R-TX, chairman of the Financial Services Committee, the bill proposes ...

The non-agency jumbo mortgage-backed securities issued by Redwood Trust between March 2010 and November 2012 haven’t taken any losses, according to Kroll Bond Rating Agency. Delinquencies on the securities remain extremely low, and a significant portion of mortgages included in the MBS have prepaid. As of July, three of the nine non-agency jumbo MBS issued by Redwood from 2010 through 2012 had loans that were delinquent. However, the loans were only in the 30-day delinquency bucket ...

The House Financial Services Committee this week approved legislation that would dissolve the government-sponsored enterprises and leave the private market to pick up the slack, with all the panel’s Democrats and two Republicans voting against it. Obama administration officials suggest that bipartisan support will be necessary to enact GSE reform and significantly increase non-agency involvement in housing finance. The Protecting American Taxpayers and Homeowners Act of 2013, H.R. 2767, was sponsored by ...

New Penn Financial is one of the few lenders putting an emphasis on mortgages for borrowers that are foreign nationals. The company offers mortgages to non-U.S. citizens with rates and terms somewhat looser than those offered by other lenders operating in the niche market. “Our proprietary program offers flexibility and fewer restrictions,” New Penn said. While data on mortgages to foreign national borrowers are scarce, the loans largely appear to be a non-agency product, both held in portfolio and sometimes securitized ...