The reverse-mortgage industry is in an uncomfortable place in the first quarter of 2018 due to lower volumes, higher costs and lower margins – the same issues that ail the traditional forward-lending business currently, says a new analysis by the Stratmor Group. Applications and counseling requests are down more than expected for this time of the year despite the recent rule changes implemented by the Department of Housing and Urban Development to ensure the long-term viability of the Home Equity Conversion Mortgage program. Stratmor projects HECM volume at $1.6 billion in 2018, down from approximately $2.0 billion in 2017, due mainly to dwindling refinances. “Given the reduction in the interest-rate floor, it is reasonable to expect that gain-on-sale margins will decline, but just how far, who knows,” said Jim Cameron, a senior partner at Stratmor. “The reduction in unit ...
The Department of Veterans Affairs has issued new guidance on a number of topics, including foreclosure relief in disaster areas, property management and servicing, lender’s payment or credit of veterans’ costs, acceptance of properties, redemption procedures, and reconveyance disputes. VA has extended the moratorium on foreclosures in areas that suffered the brunt of hurricanes Harvey, Maria and Irma from 180 days to 270 days to give more time for distressed homeowners with a VA mortgage to recover their financial footing. VA also extended the rescission date of guidance regarding its reconveyance dispute process and servicer statutory redemption procedures from Jan. 1, 2018, to Oct. 1, 2020. VA issued additional servicing guidance on real estate-owned properties and direct loan portfolio (VA’s national portfolio), which is currently serviced by ...
Ginnie Mae this week urged issuers to ensure that electronic protections against unauthorized automated payments from accounts do not impede the agency’s ability to draft funds from issuers’ accounts to pay investors. In a letter to stakeholders, Ginnie cautioned issuers to make certain that the ACH debit blocks they have in place would not hinder the agency from accessing funds in the central principal-and-interest custodial accounts on the 15th and 20th of each month. ACH debit blocks help prevent fraud by barring unauthorized payments from accounts and allowing companies to designate a specific person to post electronic debits to the payee’s account In addition, Ginnie asked issuers to implement a process of checking whether funds have been drawn at 7 a.m. EST on each 15th and 20th day of the month. “It is critical that each issuer also have in place a process for ...
The Department of Housing and Urban Development’s nonpayment orders were effective in preventing payment of improper claims on FHA loans, according to the department’s inspector general. The HUD IG said a review of 17 claims with an active nonpayment order and 10 claims that had no such order show no improper claims that were paid. The IG conducted its audit from October to December 2017, focusing on FHA loans that had a nonpayment order and a claim paid from Jan. 1, 2013, to Aug. 31, 2017. Of the 97 loans identified and targeted by IG auditors, 17 were picked as a non-statistical sample based on whether an inactive nonpayment order was entered on the same date as the active nonpayment order, comments entered for the nonpayment order, and the claim-payment amounts. The IG also picked 65 loans that had a claim paid after an inactive nonpayment order was created with an ...
Bipartisan Measure to Protect Vets from Loan Churning Added to S.2155. Sen. Mike Crapo, R-ID, with strong support from Democrats, offered a substitute amendment to S.2155 that includes the language of S.2304, the Protecting Veterans from Predatory Lending Act, to protect veterans from abusive refinancing schemes. Sen. Thom Tillis, R-NC, and Sen. Elizabeth Warren, D-MA, introduced S.2304 as a stand-alone bill on Jan. 11, 2018. S.2155, the Economic Growth, Regulatory Relief, and Consumer Protection Act, aims to promote economic growth, provide tailored regulatory relief, and enhance consumer protections. S.2155 was introduced on Nov. 16, 2017, and reported out of committee on Dec. 5. It was added March 8 to the Senate’s schedule for consideration. Bill Introduced to Prevent Spread of Reverse-Mortgage Foreclosures in Philadelphia. The Philadelphia City Council is considering ...
The White House this spring is expected to officially nominate Michael Bright, acting president of Ginnie Mae, to formally become the agency’s chief, according to industry officials
A new report from the Federal Reserve Bank of New York says the credit-risk transfer programs launched by Fannie Mae and Freddie Mac a few years ago have helped stabilize the mortgage securities market.
Donald Lampe, a partner in Morrison & Foerster, said: “the basic design of the no-action letter process was not very effective from day one,” because of excessive burdens it imposed on applicants.
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