The government-sponsored enterprises’ guaranty fees will increase by an average of 10 basis points in the coming months as the Federal Housing Finance Agency works to align agency pricing with the private market. An increase earlier this year brought interest rates on agency mortgages slightly closer to the rates on non-agency jumbo mortgages but industry analysts suggest that the conforming loan limits have a greater impact on the market share for non-agency originations. “These increases will move [GSE] pricing ...

The reverse mortgage industry is at odds with consumer advocates and the Consumer Finance Protection Bureau over a recent CFPB study, which claimed that consumers find reverse mortgages too complex and difficult to understand and that the risk of fraud and other scams persist. The latest dispute flared as reverse mortgage lenders and consumer groups responded to the CFPB’s request for information on abusive financial practices that affect elderly Americans. The comment period ended on Aug. 31. To assist its ongoing study of reverse mortgage transactions, the CFPB in July sought ...

The Department of Housing and Urban Development’s disciplinary arm hit 14 FHA-approved lenders with civil money penalties totaling $2.31 million for various violations of FHA regulations. HUD’s Mortgagee Review Board imposed the fines as a result of separate administrative actions against the lenders from Aug. 1, 2011, to Dec. 31, 2011. The MRB report, which was published in the Sept. 10 Federal Register, cited various offenses, including improper lending practices, failure to follow FHA origination guidelines, fraudulent reporting, failure to remit mortgage insurance premiums, failure to report ...

An approved FHA lender in Brentwood, TN, is reporting a mini boom in its FHA refinance business, thanks to the FHA Streamline Refinance program. Churchill Mortgage, a provider of conventional and government-backed loans in 26 states, has reported a 540 percent increase in its FHA refi business through the agency’s streamline program. According to Matt Clarke, chief operating officer, Churchill Mortgage is expecting this year to top last year’s FHA refi production as well as its FHA streamline originations. In 2011, the company reported an estimated ...

The first six months of 2012 saw heightened activity in FHA’s Streamline Refinancing as borrowers scrambled to take advantage of the program’s lower insurance premiums. Streamline refi originations jumped 90.5 percent during the last two quarters compared to volume reported over the same period last year. Production rose 13.5 percent from the first to the second quarter. Volume increases have been amazing since the third quarter of last year, when lenders reported $4.7 billion in total streamline refi originations. Since that period, production leapfrogged to ... (1 chart)

Fannie Mae and Freddie Mac both saw substantial declines in deliveries of home mortgages with balances exceeding $417,000 during the second quarter, offsetting a significant increase in FHA originations of conforming jumbo loans. Combined, the three agencies did $24.1 billion in conforming jumbo mortgage business – loans on single-unit properties in the lower 48 states that exceed the old $417,000 loan limit. That was down 16.3 percent from the first three months of 2012 at a time when overall mortgage origination volume fell 5.2 percent. Meanwhile, originations of non-agency jumbo loans rose...[Includes two data charts]

What started as a battle between investors has spread to include lenders, borrowers and servicers. Proponents of plans to use eminent domain for principal reduction warn that the government-spon-sored enterprises and lenders could be subject to redlining and other consumer protection regulations for opposing the evolving scheme. No county or municipality has implemented a wide-scale eminent domain plan, though a number of areas are considering the option. Non-agency mortgage-backed security investors have strongly opposed eminent domain proposals, claiming they are unconstitutional, among other issues. “This unprecedented use of eminent domain law, if successful, would...

Despite increased activity in the Fannie Mae and Freddie Mac refinance programs for underwater borrowers during the second quarter of 2012, total refi originations declined by 4.8 percent from the first three months of the year, according to a new Inside Mortgage Finance analysis and ranking. Refinance activity still accounted for 68.1 percent of originations during the most recent quarter, but that was down from 75.3 percent in the first three months of the year. Partly offsetting the drop in refi business was a 35.8 percent increase in purchase-mortgage originations, which rose to an estimated $129.0 billion in the second quarter. But compared to the first half of 2011, purchase-mortgage lending was down 1.3 percent as of the midway point this year. Refinance originations appear to be climbing in the third quarter. Data on Fannie and Freddie securitization activity in July and August suggest that total refi business at the government-sponsored enterprises is...[Includes four data charts]

One of the most worrisome elements to emerge so far in the Consumer Financial Protection Bureau’s proposed rule on mortgage loan originator compensation is the agency’s consideration of factors that may serve as proxies for prohibited transaction terms and how they may be used to restrict originator compensation. The CFPB proposal would implement statutory changes made by the Dodd-Frank Act to the Truth in Lending Act/Regulation Z loan originator compensation rule, including a new, additional restriction on the imposition of any upfront discount points, origination points or fees on consumers under certain circumstances. The proposal provides...

The blowback over yield-spread premiums and subprime mortgages continued in Lee v. Countrywide Home Loans, Inc., in which the U.S. Court of Appeals for the Sixth Circuit has determined that a lender – in this case, Countrywide Home Loans, and by extension, parent Bank of America – may be liable under state common law claims of civil conspiracy for failing to disclose fees paid to a mortgage broker. This subprime mortgage case was brought by the borrowers (the Lees) against the lender (Countrywide), its parent company (Bank of...