Servicers involved in national settlements are largely in compliance and making progress toward completing their loss-mitigation requirements, according to reports released in the past two weeks. Joseph Smith, the monitor of a settlement involving non-agency mortgage-backed securities that requires JPMorgan Chase to complete $4.0 billion in credited loss mitigation, said that as of the end of 2014, Chase was credited with $3.32 billion in relief ...
The Treasury Department didn’t meet key elements of federal guidelines for cost-benefit analysis when considering changes to the non-agency Home Affordable Modification Program that were implemented in November, according to the Government Accountability Office. In a report released last week, the GAO conceded that the Treasury isn’t required to follow cost-benefit guidance from the Office of Management and Budget when making changes to HAMP ...
Underwriting standards for jumbo mortgages tightened for the second consecutive month in June, according to the Mortgage Bankers Association. The MBA’s credit availability index for jumbos was slightly below the post-crisis peak set in April. The government-sponsored enterprises and Common Securitization Solutions announced this week that eight organizations will be included in an advisory group regarding the common securitization platform ... [Includes three briefs]
Rising home values could present a new opportunity for FHA borrowers to refinance into a conventional loan and enable those borrowers who choose to stay with FHA financing to take advantage of FHA’s reduced annual mortgage insurance premium, according to lenders. With house prices on the rise, FHA borrowers are seeing a build-up in equity. This might be a good time for them to remove that monthly payment and get out of their FHA loan, said Faramaz Moeen-Ziai, vice president of national sales and production at Commerce Home Mortgage in Huntington, CA. With an FHA-insured loan, coverage is for the life of the loan while private mortgage insurance on a conventional is cancellable when paid down to 79 percent of the loan amount. This might be especially beneficial to homeowners living in homes valued far less than what they owe on the property, or to holders of ...
Mortgage industry participants are finding a recently proposed FHA rule that would cancel coverage for late claim filings too harsh. “The penalty far exceeds the crime,” said a mortgage industry consultant, echoing sentiments of lender clients. Out for comment until Sept. 4, 2015, the proposed rule would require lenders to file a claim for a real estate-owned property within three months from the date they obtain title to the property or successfully sell the property to a third party. The requirement would apply to both pre-foreclosure sale and deed-in-lieu of foreclosure. The Department of Housing and Urban Development said the proposed rule would remedy the problem of delayed claim filings – lenders hoarding claim requests and filing them in batches at the same time. HUD’s goal is to process claims sooner and get more accurate data that are accurate for the next ...
The Department of Veterans Affairs has issued guidance to servicers regarding the use of an auction service in lieu of a foreclosure sale to terminate a VA loan. The goal is to get more from foreclosure-sale proceeds to lower the veteran’s mortgage debt. Mortgage holders may find it better to pursue VA loan termination through an auction service, rather than having to waive a greater amount at foreclosure, the VA said. It also may raise awareness among potential bidders and increase marketability and competition, the agency said. While traditional foreclosure methods have long been a part of the loan termination process, they limit servicers’ chances of obtaining greater proceeds at sale, which are applied to lower the veteran’s debt. Consequently, VA ends up paying more for a claim and assuming the liability of managing and marketing a conveyed real estate-owned property. In addition, state and county ...
Lending to veterans and members of the U.S. military is expected to trend up in the second half of 2015 as the economy improves further, wages rise and unemployment declines, predicts the country’s top VA lender. “We’re seeing increased activity in housing while house values have gone up modestly, which I expect will continue in the next couple of years,” said Stan Middleman, president and chief executive of Freedom Mortgage. It is a great time for veterans to purchase a home, Middleman said, and he would he like to see more vets become homeowners. However, despite the low interest rates, crisp and clear underwriting and no downpayment required, many veterans are still not taking advantage of the VA program as they should, he noted. Middleman feels he should advertise and market the VA product more. In the past seven months, Freedom Mortgage has added ...
Industry experts are sharply divided on whether the FHA’s financial condition is actually getting better or worse. Potomac Partners, a business consultancy group, is optimistic that the FHA’s Mutual Mortgage Insurance Fund has finally turned a corner with great signs of improvement in the first quarter of 2015. Changes and adjustments made by the Department of Housing and Urban Development since last year have placed the MMI Fund on a positive trajectory to reach its required 2.0 percent capital ratio in 2016. Last year, the fund’s capital ratio improved from a negative 0.11 percent to a positive 0.41 percent and its economic value appears to be improving. Potomac Partners’ analysis looked at FHA risk, loan performance, delinquency rates, debt-to-income ratios, loan-to-value ratios, originations and claims, loss rates as well the effect of the ...
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