Consumer Financial Protection Bureau Director Richard Cordray has repeatedly told mortgage lenders that there are plenty of good loans to be made outside the confines of the qualified mortgage. Increasingly, it looks like market dynamics are backing him up. During a webinar last week hosted by Inside Mortgage Finance, Larry Platt, a partner with the K&L Gates law firm, noted that some lenders are looking outside the QM box to bolster loan origination volume that has plummeted. “The volume is down, and we’ve moved into a purchase-money market,” he observed. Also, there’s...
Richard Smith, chief marketing officer for Ditech, said the mortgages that the company originates will close in Ditech’s name, not in the name of Green Tree.
In case you didn’t notice, the price of Fannie and Freddie common rose about 5 percent Tuesday, after Watt spoke. In trading Wednesday, they were up again...
“This decision is motivated by concerns about how such a reduction could adversely impact the health of the current housing finance market,” said FHFA Director Mel Watt.
In his comments to reporters, FHFA Director Mel Watt did not rule out Fannie and Freddie engaging in principal reductions to help troubled consumers who have GSE loans.
Compare ratios have been criticized by some factions of the mortgage industry. Some lenders have complained that the ratio is one reason why originators do not target underserved markets.
In a wide-ranging speech – and in supporting documents – Mel Watt also vowed that the GSEs will continue to permit “compensating factors” when weighing a decision to guarantee mortgages where the debt-to-income ratio is north of 43 percent.
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