Wells, Bank of America and JPMorgan Chase accounted for a combined 44.7 percent of the $517.75 billion in bank HELOCs outstanding at the end of the third quarter.
Advisors note that Walter should be concerned that it has a large MSR portfolio – $194 billion at Sept. 30, according to figures compiled by Inside Mortgage Finance – but a relatively small origination platform.
“In our view, the primary risk associated with some lenders being less than fully prepared for QM could be temporary loan production delays,” the consulting firm adds.
Loan broker Anne James, who runs Reliance Funding in Wittier, CA, told us recently that “I have wholesale lenders calling me daily to sign up.” She notes, however that “Loans are not dropping out of the sky” but adds that she’s getting quite a few calls for second mortgages.
Whether a given mortgage meets the criteria of a qualified mortgage under the CFPB’s ability-to-repay rule, in and of itself, will not be considered a safety- and-soundness issue, according to joint supervisory guidance issued late last week by federal financial regulators. Nor will QM status – or the lack thereof – be a make-or-break issue in terms of Community Reinvestment Act compliance, the feds added, echoing similar guidance issued back in October. “From a safety-and-soundness perspective, the agencies...
The Conference of State Bank Supervisors called upon Congress to confer small creditor “qualified mortgage” status upon all mortgages held in portfolio by community banks, as part of a larger call to “right-size” federal regulations that disproportionately focus on the risks to huge institutions, at the expense of smaller institutions.One of the primary examples of regulatory relief for smaller institutions has come from the CFPB’s Small Creditor QM rule, the organization said in a white paper released last week. The small...
A mortgage lender’s documentation of compliance with the CFPB’s ability-to-repay qualified mortgage rule is just about as essential as compliance itself, a top industry attorney advised participants in a webinar sponsored by Inside Mortgage Finance Publications last week. And Joseph Reilly, a partner with the BuckleySandler law firm, reached into Zen lore to make his point. “If a tree falls in the forest and no one hears it, does it make a sound?” he asked. Similarly, “Starting in 2014: If a lender complies with ATR/QM but...
Officials from the CFPB and the Federal Reserve held a webinar earlier this month to help small creditors understand qualified mortgage lending under the bureau’s ability-to-repay rule. To begin with, there are two special categories of QMs for small lenders, portfolio QMs and balloon QMs. Also note that the ATR rule provides additional flexibility to small lenders in that the safe harbor has been expanded to 3.5 percent over the average prime offer rate. The first step to determine eligibility – of both the lender...
The Mortgage Bankers Association has put together some guidance, drawn from conversations with CFPB staff, on how to exclude affiliate fees in the points-and-fees calculation for qualified mortgages under the agency’s ability-to-repay rule, which takes effect in just a few weeks. The bureau’s ATR and Home Ownership and Equity Protection Act rules contain a cap or limit on points and fees to qualify as a QM loan and a specific points-and-fees threshold triggering HOEPA coverage. The calculation of points and fees under both of these...
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