The recent change in the FHA’s maximum loan limits would have relatively limited impact for current borrowers trying to refinance, according to analysts. FHA loans insured prior to Oct. 1, 2011, were already grandfathered in for streamlined refinancing regardless of loan size, said analysts with J.P. Morgan Securities. In addition, the analysts said they do not expect many conventional jumbo-to-FHA refinances in this market segment because the mortgage insurance premiums make FHA loans less attractive. Last month, President Obama signed an appropriations bill into law, reinstating the pre-Oct. 1 formula for calculating the “temporary” loan limits for high-cost areas, which is ... [With one chart]

Expenses for maintaining foreclosed properties before their transfer or conveyance are much higher for FHA than for Fannie Mae or Freddie Mac, according to a recent Government Accountability Office report. The report, which focuses on the growing number of vacant properties and the costs and challenges of maintaining them, found that FHA’s pre-conveyance reimbursements to servicers are higher than the government-sponsored enterprises’ pre-foreclosure reimbursements. In 2010, the FHA reimbursed servicers about $1,982 compared to the GSEs’ $235 per property for maintenance-related expenses prior to ...

Ginnie Mae recently announced changes to rules implementing provisions under the Servicemembers’ Civil Relief Act for reimbursing excess mortgage interest to Ginnie Mae issuers. Under the revised SCRA reimbursement policy, issuers will be reimbursed excess interest payments on SCRA mortgage loans based on two different dates for reservists and active members of the military, said Ginnie Mae officials during an issuer outreach webinar on Dec. 8. If the borrower is a reservist, the reimbursement will be based on the date of the receipt of the deployment letter and reimbursements for active members will be based on the deployment date. Under the SCRA, mortgage lenders are required to ...

Total FHA endorsements declined 4.2 percent in October from the previous month and 29.7 percent from a year ago even as FHA refinances continued to slow, according to an Inside FHA Lending analysis of FHA data. A total of 88,060 mortgages were endorsed for FHA insurance in October, down from 91,963 loans in September. Of the October endorsements, 60,596 were purchase loans, down 9.0 percent from the previous month and 7.9 percent from the same reporting period last year. FHA refinancing increased 15.4 percent on a month-to-month basis but declined a whopping 57.9 percent from last year. Streamlined FHA refis were ... (Comes with one chart)

Changing how mortgage lenders are paid for servicing Fannie Mae and Freddie Mac loans is ill-advised at this point because servicing requirements themselves are in flux, according to the Mortgage Bankers Association. Adopting the radical fee-for-service proposal advanced by the Federal Housing Finance Agency would be particularly disruptive for a market that’s still under a lot of strain, the industry group said in a letter to the FHFA. The FHFA is collecting industry feedback on reforms to servicer compensation that is now based on a minimum servicing fee paid out of...

The volume of home mortgage debt outstanding sank to a five-year low as of the end of third quarter of 2011, according to new data released by the Federal Reserve. The agency reported that the outstanding volume of single-family mortgage debt fell 0.6 percent during the third quarter, dropping to $10.336 trillion. That marked the 15th consecutive quarterly decline and the lowest level since the third quarter of 2006. The only component in the servicing market that’s showing much growth is the Ginnie Mae program, where the outstanding balance of...(Includes two data charts)

“Tough-love” counseling for borrowers can curb re-defaults by looking critically at how all forms of spending affect a person’s ability to pay off mortgage and credit card debt, according to a subservicer that uses this approach. “Dollars are in competition when a family is in trouble,” said Stephen Stack, managing director of Outreach Financial Services. “There is a struggle between paying different creditors, and holistic counseling helps redistribute the money in the best way.” Holistic financial counseling looks at a borrower’s entire spending pattern – from mortgage to credit card to...

Just in time for the holidays, Fannie Mae and Freddie Mac each announced last week that all foreclosure-related evictions from occupied single-family and two-to-four unit properties with Fannie or Freddie mortgages will be suspended from Dec. 19, 2011 to Jan. 2, 2012.

The number of settlement problems as an overall percentage of market closings has increased in past months as on-time settlements plunged to 47 percent from 65 percent, according to the latest survey by the National Association of Realtors. Respondents to a monthly NAR survey cited problems with obtaining mortgages along with appraisal and inspection problems as causes of settlement delays and cancellations. The inability to obtain a mortgage was reported by 9 percent of respondents in October as causing a settlement cancellation, up from 4 percent in September. Asked whether they had any problems in...

Home prices remain under stress. The CoreLogic Home Price Index shows that home prices have decreased 1.3 percent from September to October, making it the third consecutive month in which home prices have been on a downward slide. Looking at it from a wider scope, national home prices (including distressed sales) have decreased 3.9 percent from Oct. 2010 to Oct. 2011. Excluding distressed sales, Oct. 2011 posted a 0.5 percent yearly decline. States in the best shape, when including distressed sales, are West Virginia, with 4.8 percent price appreciation; South Dakota, with 3.1 percent...