The jumbo mortgage market enjoyed solid growth in new originations last year, but agency securitization programs regained some of the ground lost to the private sector back in 2011, according to a new Inside Mortgage Finance ranking and analysis. Fannie Mae, Freddie Mac and the FHA in 2012 financed a record $117.6 billion of home mortgages that exceed the traditional jumbo threshold of $417,000. That was up 38.9 percent from the combined agency total back in 2011, and it was roughly twice the growth rate in non-agency jumbo mortgage originations. The non-agency jumbo market rose...[Includes three data charts]

Republicans on the Senate Banking, Housing and Urban Affairs Committee got a tougher time from their Democrat counterparts than Richard Cordray got from the Republicans during this week’s hearing on his re-nomination to be the director of the Consumer Financial Protection Bureau. Political observers see that as a sign of GOP confidence in the leverage they have in trying to compel President Obama and his allies on Capitol Hill to agree to some key changes to the bureau in exchange for installing Cordray for a second term at its helm. Republicans continue...

Early on, one of the biggest problems with the Home Affordable Refinance Program was the inability of nonbank lenders to participate in the effort. Many were willing – but their warehouse lenders were nervous about putting high loan-to-value loans on their books, even for just a few weeks. But since last summer Fannie Mae, and to a lesser extent Freddie Mac, have made a concerted effort to allay the fears of warehouse financiers about the risk inherent in the loans. “Fannie Mae has basically been...[Includes one data chart]

Most mortgage banking firms – both bank and nonbanks alike – have been posting record profits over the past year, creating the pleasant problem of what to do with all that cash. According to interviews conducted by Inside Mortgage Finance over the past few weeks, certain nonbank owners have been taking cash out of their companies, using the money to pay hefty tax bills. Others have been leaving money in the company and searching for ways to shelter income. One way to do that, according to some tax experts, is to retain originated servicing rights. This is...

Few multistate lenders subject to reviews by state regulators submitted sufficient mortgage call report data last year, according to the Multistate Mortgage Committee. The regulators also cited lenders for origination issues and said they are working toward settlements with smaller servicers. The 2012 annual report released late last week by the MMC detailed two separate widespread data-related violations of state regulations, one involving limited scope electronic exams and the other involving a risk profiling program. The LSE exams were introduced...

Private mortgage insurers and their industry allies this week warned Congress that a narrowly defined “qualified residential mortgage” rule and the proposed Basel III asset risk-weighting proposal could push loans to the FHA and make solvency a bigger problem for federal mortgage insurance. Industry representatives testifying during a hearing before the House Financial Services Subcommittee on Housing and Insurance said that while current FHA policies have crowded out private mortgage insurers from the marketplace, there are proposals under consideration that could give the FHA an even greater edge over private MIs. Specifically, the proposed QRM rule would exclude...

A new General Accounting Office report said adopting a VA guaranty model for the FHA would result in better-quality loans, a strong capital reserve and even tougher lender overlays that could result in fewer FHA borrowers. The new GAO report reiterated a previous assessment that adopting a VA guaranty model for FHA would have advantages and disadvantages but made no recommendation either way. Private mortgage insurers and others have put...

A U.S. Senator’s call for a Department of Justice investigation into whether Lender Processing Services used an improper fee structure to double-bill underwater homeowners for servicing fees related to processing foreclosures and bankruptcies is off the mark and old business, say industry observers. In a letter sent last week to Attorney General Eric Holder, Sen. Ron Wyden, D-OR, cited concerns brought to his attention by an industry professional that Jacksonville, FL-based LPS engineered a scheme to charge homeowners or mortgage investors for foreclosure-related legal services provided by the company’s preferred network of law firms. Banks using LPS network law firms would receive free access to the firm’s mortgage-processing software, according to the letter. “The ramifications of this case, however, seem...

The available supply of residential MBS grew marginally during the fourth quarter of last year as the agency market grew enough to offset the ongoing decline in outstanding non-agency MBS, according to a new analysis by Inside MBS & ABS. The supply of single-family agency MBS increased by $48.1 billion during the fourth quarter, a 0.9 percent increase over the three-month period. The Federal Reserve gobbled up all the increase and then some; its total agency MBS holdings rose by $91.6 billion during the fourth quarter, an 11.0 percent increase from the previous period. Mutual funds appeared to hold...[Includes two data charts]

The U.S. Supreme Court last week unanimously decided a securities fraud case that could cause the Securities and Exchange Commission to act sooner rather than later in bringing enforcement actions against MBS fraud. In Gabelli et al. v. Securities and Exchange Commission, SCOTUS ruled that in an SEC action to recover civil penalties, the five-year statute of limitations begins ticking when the fraud occurs, not when it is discovered. Reversing an opinion by the U.S. Court of Appeals for the Second Circuit, SCOTUS rejected...