Many low-income and minority borrowers are forced into FHA loans by risk-based pricing and overlays in the conventional market, only to be stymied by higher FHA premiums and non-cancellable mortgage insurance premiums, according to a new study from the Center for Responsible Lending. The study, “Repairing a Two-Tiered System: The Crucial but Complex Role of FHA,” examines FHA’s pre- and post-crisis lending to white and minority borrowers. It also evaluates the impact of risk-based and FHA pricing as well as the impact of False Claims Act enforcement, which have limited the FHA program’s effectiveness in meeting homeownership goals, said authors Peter Smith, CRL senior researcher, and Melissa Stegman, senior policy counsel. The authors used Home Mortgage Disclosure Act data from 2004 through 2016, focusing solely on single-family purchase mortgages made to ...
Actions by a number of private mortgage insurers to cut borrower-paid premium rates would enhance affordability and enable private MIs to increase their market share at FHA’s expense, according to an analysis from the Urban Institute. So far, Mortgage Guaranty Insurance Corp., Genworth Mortgage Insurance and Radian Guaranty have announced reductions in their respective monthly and single-premium borrower-paid premium rates. The premium cuts will affect more than just affordability, said UI. On March 6, the company announced that it is reducing borrower-paid single-premium rates in most FICO buckets, effective for all MI applications received on or after March 19, 2018. The Philadelphia-based MI also reminded clients that previously announced single-premium restrictions on debt-to-income ratios exceeding 45 percent and a FICO score below 700, or DTI exceeding ...
Guild Mortgage has announced an FHA-backed financing program that would allow homebuyers to finance solar panels through a mortgage when purchasing a house. It is not Property Assessed Clean Energy financing, which has similar goals but is prohibited by FHA because it asserts lien superiority over all other liens, including a residential mortgage. Guild developed the program, FHA Solar, with FHA to ensure adherence to all agency loan requirements, according to a company representative. “It sounds like Guild slapped their own brand on a loan product that appears to fit among FHA’s various energy-efficient programs, not to be confused with PACE obligations, which are no longer a part of our single-family insurance program,” said a Department of Housing and Urban Development spokesman. FHA Solar is available to residents in California. It provides homebuyers the ...
Recent moves by two private mortgage insurers to reduce mortgage insurance premiums for borrower-paid MI policies would have a positive impact on affordability and potentially increase MI market share at the expense of FHA, according to a report from the Urban Institute.
Excessive risk-based pricing, high private mortgage insurance premiums and lender credit overlays are locking out low-income borrowers and families of color from the conventional mortgage market, pushing them towards FHA as their only option, concludes a new study from the Center for Responsible Lending.
Freddie Mac Announces $497M SLST. Freddie Mac announced an approximately $497 million Seasoned Loan Structured Transaction of seasoned re-performing loans from its mortgage-related investments portfolio.This will be the fourth SLST since the launch of the program in 2016 and the first SLST of 2018. It also marks the first time a Freddie-created trust will be the issuer of the SLST securitization. OIG Says FHFA Complied with Statutory Improper Payment Requirements. The Federal Housing Finance Agency Office of Inspector General noted in an April 26 audit that the FHFA complied with applicable improper payment requirements during fiscal year 2017. The auditor reviewed several...
A ranking of primary mortgage insurance for purchase mortgages by state in the first quarter of 2018. Includes private mortgage insurance, FHA, VA and USDA Rural Housing.
Along with nearly all mortgage indicators, the flow of insured home loans into agency mortgage-backed securities slowed significantly during the first quarter of 2018, but early indicators suggest the FHA market may have been somewhat more resilient. [Includes three data charts.]
Issuance of new single-family Ginnie Mae mortgage-backed securities fell sharply in the first quarter of 2018, according to a new Inside FHA/VA Lending ranking and analysis. The agency issued $92.58 billion in MBS backed by forward mortgages during the first three months of 2018. That was down 14.8 percent from the previous three-month period and represented the lowest quarterly total since early 2015. The 1Q figure is based on truncated loan amounts reported in Ginnie’s loan-level MBS disclosures. Reports with unrounded single-family loan amounts show a total of $95.75 billion in first-quarter MBS issuance, including FHA reverse mortgages. The loan-level data reveal that production fell 6.9 percent from February to March, when just $28.21 billion of Ginnie single-family securities were issued. That was the lowest monthly volume since February 2015. Both the FHA and VA programs saw significant ... [Charts]
RSS