So, you doubt our 2Q origination estimate? Here’s what an executive from a top-five warehouse bank told us: “We’re experiencing a significant pick up in outstandings."
A new audit issued last week by the Federal Housing Finance Agency’s official watchdog revealed that an unnamed nonbank special servicer raised red flags for Fannie Mae, Freddie Mac and their regulator.The report by the FHFA’s Office of Inspector General prompted the FHFA to issue guidance on the counterparty risk posed by nonbank servicers by year’s end. The OIG audit said the Finance Agency and the two GSEs “have responded well to specific problems at nonbank special servicers.”
By now, the word is out: the Federal Housing Finance Agency is exploring codifying capital minimums for nonbank servicers as a way to help Fannie Mae and Freddie Mac better manage counterparty risk. Industry officials tracking the topic told Inside Mortgage Trends they don’t believe the FHFA is necessarily worried about the capital positions of the big three nonbanks: Nationstar Mortgage, Ocwen Financial, and Walter Investment Management ...
Walter Investment Management took steps last week to transition to a business model that requires less capital by funding Walter Capital Opportunity and completing an excess servicing spread sale with WCO. WCO is a real estate investment trust that Walter formed in November to hold mortgage servicing rights. Last week, WCO acquired 70 percent of the excess servicing spread from a pool of loans serviced by Green Tree Servicing ...
The Democratic proposal calls for private mortgage capital to backstop the first 5 percent of conventional-mortgage securitizations with the remaining 95 percent of risk shared “on a pari passu basis.”
Thanks to lousy origination profits posted over the past six months, mortgage bankers increasingly are boosting earnings through servicing-released arrangements, causing a mini-boom in flow transactions. “You might say we’re back to a normal operating environment where originations are cash-flow negative,” which is forcing lenders to book profits through MSR sales, said Jeff Levine, managing director of Houlihan Lokey, an investment banking firm. But Levine is...
The Inspector General of the Department of Housing and Urban Development called on the FHA to clean up and update its shared database of federal debtors in default, including FHA borrowers, to ensure the information it holds matches data in the FHA’s default and claims systems. An audit by HUD’s IG found that the Credit Alert Verification Reporting System (CAIVRS), which lenders use to screen delinquent federal debtors from obtaining any more government-backed loans, did not contain default, foreclosure and claims information for more than 260,000 borrowers. As a result, ineligible borrowers were able to obtain new federal loans and loan guarantees. The IG estimates...
We know of some veteran mortgage bankers who believe the “fix and flip” housing market is getting overheated. One lender told us he fears a severe correction could hit California…
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