Observers of the subprime auto ABS market are raising concerns as delinquencies rise above peaks seen during the financial crisis as lenders have loosened underwriting standards in search of market share. According to Fitch Ratings’ index of subprime auto ABS, 60+ day delinquencies on loans backing the securities hit 5.45 percent at the end of 2016. Delinquencies were up from 4.70 percent at the end of 2015 and 41 basis points higher than the peak for the sector in 2009. The index tracks an outstanding balance of $38.6 billion from 149 transactions. There were 21 active shelves in the index, up from 12 active issuers in 2010. “Smaller lenders along with recent new entrants are...
Housing finance reform, especially if it weakens mortgage underwriting standards, could have a negative impact on private-label MBS as well as the government-sponsored enterprises’ credit risk-transfer transactions, according to a newly published report from Moody’s Investor Services. Analysts said that various reform proposals could reduce the influence that Fannie Mae and Freddie Mac have in the market and likely increase credit risk in new MBS in the short-term. Combined with a rising interest rate environment, such reform could have a credit-negative effect. Loan origination processes and the kinds of loans produced could become...
Publicly traded mortgage-banking firms had a rough ride in 2016, which turned out to be a turning point for one of the sector’s stalwarts, PHH Mortgage. The nine publicly traded mortgage lenders tracked by Inside Mortgage Trends posted a combined $563.8 million in net income on their mortgage-banking operations during the fourth quarter. That was up sharply from the third quarter, but it was not enough to offset huge combined losses during the first half of ... [Includes one data chart]
Most lenders aren’t currently using so-called next-generation mortgage technology service providers, according to a survey conducted by Fannie Mae. High costs are among the reasons keeping many lenders from adopting technology that could ease the burdens borrowers face when obtaining a mortgage. Some 63.0 percent of the 184 lenders surveyed by Fannie in November said they haven’t used next-gen tech providers. Fannie released the survey results ...
Mortgage bankers ended a very good year in 2016 on a somewhat offbeat note as overall company profits sagged and production margins shrank. The average mortgage-banking operation generated $3.513 million in pretax income during the fourth quarter of 2016, according to the latest data from the Mortgage Bankers Association. That was down 10.8 percent from the average pretax income in the trade group’s third-quarter Mortgage Bankers Performance report ...
Over the past three years, Walter Investment Management Corp. has posted net losses totaling $902.6 million – more than any other publicly traded mortgage company with the exception of one: Ocwen Financial, which lost $915.6 million over that period. And while Ocwen may finally be turning the corner in terms of both its regulatory problems and negative cashflow, the jury is still out on Walter, which saw its stock price fall to less than 70 cents a share this week ...
Credit bureau Experian and data services vendor Finicity have partnered to come up with a digital verification capability to help bring the lending industry to the point where a “10-by-10” mortgage becomes the norm; that is, a loan application that can be completed in 10 minutes, and the resulting mortgage closed in 10 days. Experian said its new Digital Verification Solutions will provide verification of assets and income by utilizing Finicity’s data aggregation and insight platform ...
If left unresolved, the tightness of mortgage credit would result in a much lower percentage of homeowners because most potential new homebuyers would likely be Hispanic or nonwhite – groups with lower income, less wealth and lower credit scores, according to a new study by the Urban Institute. Author Laurie Goodman, co-director of UI’s Housing Finance Policy Center, noted the very tight mortgage credit situation that has developed since the mortgage crisis, which she attributed to mortgage lenders becoming more cautious than ever in their lending.
A program launched in September to provide grants to mortgage brokers has helped launch 15 new independent mortgage brokerage shops, according to the National Association of Mortgage Brokers. The NAMB KickStart program provides a grant of up to $10,000 to help launch broker operations. The program started with financial support from United Wholesale Mortgage. “After mega banks pinned mortgage brokers as the scapegoats of the financial crisis in ...
RSS