Two Democrat Senators have re-introduced their refinance bill that would authorize a one-year extension of the Home Affordable Refinance Program while easing other qualifying criteria for HARP borrowers. Dubbed HARP 3.0 in some quarters, the Responsible Homeowner Refinancing Act of 2013, the bill by Sen. Robert Menendez, D-NJ, -- co-sponsored by Sen. Barbara Boxer, D-CA, -- would expand HARP eligibility by providing equal access to streamlined refinancing under HARP, waive loan-to-value ratio requirements and prohibit Fannie and Freddie from charging upfront fees to refi any loan they guarantee. The new draft of the Menendez-Boxer, S. 249, includes a few technical corrections and would extend HARP for an additional 12 months beyond its scheduled expiration of Dec. 31, 2013.
Once the housing and financial markets recover from the recent economic turmoil, shutting down Fannie Mae and Freddie Mac would have a minimal impact on housing starts nationally and on the economy as a whole, according to a paper by the Heritage Foundation. The recent paper, The Role of the GSEs in the Housing Market, concludes that ending the GSEs and the accompanying mortgage interest rate subsidy of 25-to-50 basis points Fannie and Freddie provide…
The Federal Housing Finance Agency is keeping a close eye on large-scale servicing transfers because it is concerned about capacity issues that might arise from smaller players taking down portfolios that significantly increase their overall processing volume. According to industry advisors and servicing executives familiar with the issue, FHFA played a key role in Bank of America’s recent sale of $306 billion of mortgage servicing rights to Nationstar Mortgage and Walter Investment Management Corp. One source familiar with the deal said FHFA asked that Nationstar not take down the entire portfolio and that it be broken up into more than one piece. A spokeswoman for FHFA declined to comment on the matter to Inside The GSEs.
Lenders of Fannie Mae and Freddie Mac mortgages say that recently rolled out GSE guidelines intended to boost refinance activity won’t do any harm but also won’t likely have more than a modest impact. The GSEs’ recently issued guidance will soon allow lenders to offer a “refinancing incentive” to underwater borrowers so they may obtain a lower payment or move to a more stable product or a shorter term. …
Bruce Witherell, a former top executive of Freddie Mac, has emerged as a key player in the new mortgage investing real estate investment trust being launched by Cerberus. Witherell, who was a chief operating officer at Freddie from 2009 to 2011, is chairman of Cerberus Mortgage Capital, a real estate investment trust that hopes to raise at least $150 million through an initial public offering. At Freddie, Witherell was in charge of day-to-day operations of three lines of business: single-family, multifamily and capital markets.
Although it’s well known that mortgage bankers earned record profits on loan production and secondary marketing last year, a new analysis by Inside Mortgage Trends reveals that mortgage servicing was also highly profitable for the industry’s top lenders. A diverse group of 10 top lenders reported a whopping $16.98 billion in net income from mortgage production and secondary marketing last year, after posting a combined loss of $5.79 billion in 2011. Massive repurchase expenses reported by ... [Includes one data chart]
It was thought that after the financial shellacking it took by purchasing GMAC Mortgage, that hedge fund giant Cerberus might avoid the residential finance industry entirely. But perish the thought. Cerberus this month filed with the Securities and Exchange Commission for an initial public offering for Cerberus Mortgage Capital, a real estate investment trust that hopes to raise at least $150 million. Its goal: to use the money to buy a “broad range” of residential-related assets including ...
Low interest rates and improving fundamentals in the nation’s housing market appear to be driving renewed investor interest in residential mortgage loan participations, according to a market participant. Jim Cutillo, chief executive officer of Stonegate Mortgage, said the market for loan participations has grown so strong in the last few months that banks – Wall Street financial institutions as well as small and regional banks – are pursuing investment opportunities in the sector. “I think a lot ...
Officials in the financial services sector are making a fresh push to alert the mortgage and residential mortgage-backed securities industries to the potential pitfalls that delinquent homeowner association accounts pose for them. “The securitization industry has little understanding” of homeowner and other types of community associations, collectively referred to as HOAs, said Jason Serrano, co-head of structured products and managing director for securities at Oak Hill Advisors ...
Average loan-to-value ratios and debt-to-income ratios on loans securitized by Fannie Mae and Freddie Mac were slightly lower – and credit scores edged slightly higher – during the fourth quarter, according to a new Inside Mortgage Trends analysis. The average LTV ratio edged down from 78.53 percent in the third quarter to 77.54 percent in the final three months of 2012. The average DTI ratio declined slightly, from 31.92 percent to 31.88 percent, while the average ... [Includes one data chart]
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