Fannie Mae and Freddie Mac trimmed their retained mortgage investment portfolios in the first quarter of 2016 by a combined 2.8 percent. The Federal Housing Finance Agency directed the government-sponsored enterprises to wind down their portfolios by 15 percent each year until they reach $250 billion by 2018. At the end of the first quarter, Fannie’s mortgage-related investment portfolio dropped to $332.6 billion, a 3.6 percent decline from December 2015. The biggest drop was in the GSE’s non-agency MBS holdings, which fell 21.3 percent in the first quarter to just $13.3 billion, roughly one tenth the amount held back in the heyday of the subprime and Alt A MBS markets. Fannie plans...[Includes one data table]
Lenders are getting more comfortable with originating non-qualified mortgages, particularly as opportunities to complete refinances decline. Non-QMs accounted for 14.0 percent of mortgages originated by 159 banks in 2015, up from a 10.0 percent share of originations the previous year, according to a survey by the American Bankers Association. “More banks are adjusting underwriting criteria to target selected non-QM loan opportunities,” the trade group said. The ABA found...
Ongoing declines in the volume of subprime mortgages outstanding have done little to limit regulatory issues involving subprime servicing. An estimated $287.0 billion in subprime mortgages were outstanding as of the end of the first quarter of 2016, down 16.3 percent from the first quarter of 2015, according to a new ranking and analysis by Inside Nonconforming Markets. The Consumer Financial Protection Bureau released...[Includes one data table]
The costs of ongoing monitoring mandated by various regulators contributed to the large $111.2 million net loss posted by Ocwen Financial in the first quarter of 2016 that included $30.0 million in monitoring costs. Ocwen continues to make progress toward decreasing settlement-related costs though regulatory pressures persist. Ocwen’s monitor costs were...
Senate appropriators have opted to set aside fiscal 2017 funding for FHA information technology upgrades rather than authorize the agency to charge lenders an administrative fee to pay for improvements. The committee approved the funding as part of its proposed Housing and Urban Development-Transportation budget for FY 2017. Appropriators set aside $13 million in specific funds for FHA IT improvements. HUD proposed that up to $30 million in fees would be charged to lenders on endorsements through Sept. 30, 2019. Collections from such fees would be credited as offsetting collections to the Mutual Mortgage Insurance Fund. Specifically, HUD sought to use the collections to partially offset a requested $160 million funding for improvements to administrative contract support, FHA staffing and information technology. Congress has rejected the ...
Younger, active-service soldiers are outpacing non-military homebuyers under the age of 35 in home purchase – and they are buying larger, more expensive homes with VA loans, according to a new National Association of Realtors survey. The NAR survey, 2016 Veterans & Active Military Home Buyers and Sellers Profile, found quite a few contrasts between active-service military homebuyers and those who have never served. Of all homebuyers, 18 percent were veterans and 3 percent were in active military service. Of all home sellers, 21 percent were vets and 1 percent were active-military. According to the survey, the typical active-service homebuyer was a lot younger (median age of 34 years old) than non-military buyers (40 years old). The active-military homebuyer was more likely to be married and have several children living in the household. Consequently, they prefer larger single-family homes. Interestingly, the ...
The Department of Veterans Affairs has called upon holders of VA-guaranteed single-family mortgage loans to extend forbearance to distressed homeowners affected by the severe storms and flooding in Louisiana and Texas. In recent guidance, the VA described measures VA lenders may employ to provide relief to disaster-stricken homeowners. The agency recommended careful counseling to see whether borrower difficulties are related to the storms or have been the result of other events. If appropriate, prepayments may be reapplied to cure or prevent a borrower default. Servicers also may consider loan modification without VA’s prior approval if certain regulatory conditions are met. Although the holder of the loan is ultimately responsible for determining when to initiate foreclosure or complete termination action, the VA has requested a 90-day freeze on ...
The California Reinvestment Coalition last week called upon the Department of Housing and Urban Development to impose a moratorium to prevent CIT Group and its servicing subsidiary, Financial Freedom, from initiating any more reverse mortgage foreclosures. The CRC’s request is based in part on data it obtained from HUD indicating an unusually high foreclosure rate for Financial Freedom/CIT Group.According to the data, Financial Freedom’s 39 percent share of reverse mortgage foreclosures since April 2009 is more than two times greater than the company’s estimated market share. The CRC began looking into Financial Freedom’s foreclosure history after receiving complaints from a number of widowed homeowners and other heirs about Freedom’s foreclosure practices, said Kevin Stein, CRC associate director. Stein said the CRC filed a data request under the ...
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