The Federal Reserve’s latest senior loan officer survey found the CFPB’s ability-to-repay/qualified mortgage rule is not having much of an effect on the conforming mortgage market but is being felt in the jumbo and nontraditional spaces. The July survey included a set of three special questions on the effects on the approval rates for home-purchase loans of the ATR and QM standards under the Truth in Lending Act, which came into effect early this year. The first question asks respondents to indicate the extent to which the ATR/QM rule is affecting the likelihood of their banks approving applications from individuals for mortgage loans to purchase homes for each of four categories of residential real estate loans. [includes one exclusive data chart] ...
Nearly three-fourths (74 percent) of senior mortgage executives surveyed by Fannie Mae’s Economic and Strategic Research Group in June indicated that they expect operational costs to increase as a result of the CFPB’s ability-to-repay/qualified mortgage rule. Most lenders (80 percent) said they “do not plan to pursue non-QM loans” or prefer to “wait and see”. “Larger lenders are more likely to pursue non-QM loans to increase their market share,” Fannie said. Also, most firms (84 percent) reported that they expect at least 90 percent of their single-family mortgage origination dollar volume to still be considered qualified mortgages. Further, “Lenders, on net, expect to tighten credit standards as a result of QM rules,” according to the government-sponsored enterprise, with 36 percent ...
A number of mortgage finance industry groups have expressed concern about how the CFPB’s ability-to-repay rule is interfering with the return of private investor capital back into the sector – mostly because of the rule’s assignee liability provisions. The industry comments came in response to a request from the Treasury Department in June for suggestions to encourage private capital to return to the non-agency mortgage-backed securities space. The Association of Institutional Investors said the ATR rule’s assignee liability provision “unfairly punishes investors who have nothing to do with the origination of loans and oftentimes have limited insight into the origination practices.” The assignee liability provision therefore introduces a risk that is almost impossible to price for those not directly involved in ...
CFPB Making Its Presence Felt Among Fannie Mae and Freddie Mac Servicers. Fannie Mae’s latest earning filing indicates the CFPB and/or the New York State Department of Financial Services have been reviewing the activities of Fannie Mae’s three largest non-depository servicers (which would be Nationstar, Ocwen and possibly Quicken Loans, according to the latest ranking by Inside Mortgage Finance, an affiliated publication). The scrutiny of Quicken Loans seems to be a new development. The bureau would not comment. Meanwhile, during the first half of 2014, Freddie Mac said in its second quarter earnings announcement that it implemented requirements for its seller/ servicers in response to some final rules from the CFPB, including rules concerning the requirements for borrowers’ ability to ...
The HUD IG found the Federal Housing Administration failed to bill lenders for 486 loans with enforceable indemnification agreements that created losses for the FHA.
The VA home loan guaranty program also is building market share, with $25.52 billion of new business written during the second quarter, a 36 percent increase from early 2014.
The Investors Unite chief said Watt has publicly acknowledged that he possesses the Congressional authority to end the GSE conservatorships under the Housing and Economic Recovery Act of 2008.
One non-QM executive who competes with Impac said the company’s forecast likely will not come true. “Right now, this is a very limited market – and there are no securitizations,” he said.
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