Issuance of new single-family Ginnie Mae mortgage-backed securities fell sharply in the first quarter of 2018, according to a new Inside FHA/VA Lending ranking and analysis. The agency issued $92.58 billion in MBS backed by forward mortgages during the first three months of 2018. That was down 14.8 percent from the previous three-month period and represented the lowest quarterly total since early 2015. The 1Q figure is based on truncated loan amounts reported in Ginnie’s loan-level MBS disclosures. Reports with unrounded single-family loan amounts show a total of $95.75 billion in first-quarter MBS issuance, including FHA reverse mortgages. The loan-level data reveal that production fell 6.9 percent from February to March, when just $28.21 billion of Ginnie single-family securities were issued. That was the lowest monthly volume since February 2015. Both the FHA and VA programs saw significant ... [Charts]
Ginnie Mae this week meted penalties to two of the nine issuers that received warnings from the agency for excessive refinancings of VA mortgages. Bloomberg reported that Ginnie barred NewDay Financial’s and Nations Lending’s from the more lucrative multi-issuer mortgage-backed securities pools, forcing them to issue custom pools. The restrictions became effective immediately. The agency’s action could reduce mortgage interest rates by 50 basis points for FHA and VA loans, which would benefit first-time homebuyers, said Jaret Seiberg, an analyst with Cowen Washington Research Group. On the other hand, the issuers Ginnie limited to issuing custom pools will end up making loans with higher rates, the analyst noted. Ginnie’s action is part of a joint effort with the Department of Veterans Affairs to crack down on loan churning and faster prepayments of VA loans pooled in Ginnie securities. Loan churning ...
FHA streamline refinancing fell significantly in 2017 from the previous year, according to an Inside FHA/VA Lending analysis of agency data. Lenders closed 2017 with $37.4 billion of FHA streamline refi loans, buoyed by a 12.2 percent increase in origination in the fourth quarter. However, business was down a whopping 34.5 percent year-over-year. The segment ended the first quarter strongly with, $13.05 billion, but faltered over the next nine months. Streamline refinancing accounted for 15.8 percent of total FHA originations in 2017. Twelve states, led by California, each reported FHA streamline refi originations in excess of $1 billion last year. The Golden State closed the year with $8.05 billion of FHA-to-FHA refis, which accounted for 21 percent of all FHA loans in the state last year. The highest FHA streamline refi-producers after California were, in sequential order, ... [Charts]
FHA insured approximately $1.9 billion of ineligible mortgage loans made to borrowers with delinquent federal debts or who are subject to federal administrative offset for past-due child support payments, according to the Department of Housing and Urban Development’s inspector general. Approximately 9,500 loans were ineligible because the sources used by lenders to identify ineligible borrowers lacked sufficient information to raise red flags. In addition, FHA failed to guide lenders adequately in reviewing child support payments, the IG said. Federal law prohibits loans, loan guarantees or insurance to delinquent federal debtors, including those with delinquent child support subject to administrative offset, until the delinquency is resolved. Auditors drew a statistical sample of 60 loans from 13,927 FHA-insured loans that closed in 2016 and analyzed data on their related borrowers in the ...
The U.S. Department of Agriculture has announced proposed changes to the maps the Rural Housing Service uses to determine whether certain areas are eligible for its single-family and multifamily housing programs. RHS reviews the areas it covers every five years to determine which ones would be eligible for USDA home-loan guarantees. The proposed maps are based on RHS’s 2017-2018 review of data collected from the U.S. Bureau of Census 2015 American Community Survey. The ACS provides information about changes in the U.S. population, housing and workforce. The current RHS maps are based on RHS’s 2012-2013 review of the 2010 U.S. Census. The proposed maps will become effective on June 4, 2018. Properties located in areas that have been reclassified from rural to non-rural on the maps’ effective date may qualify for RHS’ housing programs if they meet certain conditions. First, the ...
The adjustable-rate mortgage share of total first-lien originations increased in 2017, according to a new ranking and analysis by Inside Nonconforming Markets. While originations of ARMs were essentially flat during the year, total first-lien production declined, boosting ARM share. ARMs accounted for 11.9 percent of total originations in 2017, up from a 10.3 percent share the previous year. An estimated $216.0 billion of ARMs were originated ... [Includes one data chart]
Lenders would be more willing to offer non-qualified mortgages if federal regulators established a “regulatory sandbox,” according to the Mortgage Bankers Association. David Stevens, president and CEO of the MBA, made the suggestion in a letter to the Treasury Department last week. He described the concept as a space where businesses can test innovative products and processes without risk of regulatory consequences from noncompliance. Stevens said a sandbox would be ...
Nonbank wholesale lenders rolled out a variety of non-agency products in recent weeks, including prime jumbo mortgages, non-qualified mortgages and nonprime offerings. Newfi Lending launched Sequoia Porfolio Plus, a program where all underwriting and exceptions are handled in-house. Steve Abreu, Newfi’s CEO, said the new offering combines “the best of jumbo and non-traditional borrowing options.” The program allows for loan amounts of up to $2.0 million, credit scores ...
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