The mortgage industry can expect more enforcement actions from the Consumer Financial Protection Bureau for the rest of the year, particularly related to fair lending issues, according to stakeholders.
The primary market tilted more heavily to conventional-conforming production in the second quarter as lenders rode soaring consumer demand and hefty profit margins to sell loans to Fannie Mae and Freddie Mac. (Includes two data charts.)
Strong demand for jumbo mortgages helped support origination volume in the second quarter even as many banks tightened underwriting standards for the loans.
The much-anticipated IPO of origination market leader Rocket Companies commenced Thursday morning but at a reduced offering price. Surprising? Not really, but some analysts are worried about lending volumes for 2021 and beyond.
Fannie Mae and Freddie Mac can purchase early forbearance loans until Aug. 31, but they still have to impose steep loan-level price adjustments to limit their risk of losses.
Thanks to a booming origination market, Fannie and Freddie posted strong earnings for the second quarter despite the economic carnage caused by the pandemic. Their capital positions also improved.
The “implied guarantee subsidy” that underpins the FHLBank operations is the reason why financial institutions of all kinds are clamoring for membership, according to former Freddie CEO Don Layton.
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