FHA condominium lending fell in the first quarter to $1.6 billion, down 8.6 percent from the prior quarter. The volume decline was the second in a row for the sector, when production fell 20.3 percent from the third to the fourth quarter last year. On the other hand, year-over-year volume saw a whopping 35.3 percent increase. The top 10 FHA condo lenders were dominated by nonbanks, with Quicken Loans leading the field. The only bank among the top 10 was Wells Fargo, which landed in third place with $45.3 million despite a 35.7 percent drop in condo loan originations in the first quarter. Leader Quicken Loans closed the quarter with $73.6 million, while second-ranked Freedom Mortgage Corp. clocked in with $55.6 million. Fourth-place LoanDepot originated $33.7 million in FHA condo loans, while Broker Solutions rounded out the top five category with $31.1 million. In November last year, FHA announced ... [ 1 chart ]

The FHA’s 203(k) Property Repair and Rehabilitation program could use some jolt as inflexible agency guidelines, construction inexperience and closing delays continue to constrain loan growth. Origination of FHA-insured fixer-upper loans fell 10.9 percent in the first quarter of 2016 to $762.7 million from $856.2 million in the previous quarter. It was a different story year-over-year, however, as volume during the first three months rose 20.8 percent compared to volume during the same period last year. The top five FHA 203(k) lenders struggled as their combined loan production dropped 9.4 percent quarter-over-quarter and by 3.0 percent on a year-to-year basis. Their combined originations accounted for $157.5 million of total FHA 203(k) loan production for the first quarter. Purchase loans accounted for $131.0 million of rehab loans originated during the period while refinance loans totaled a ... [ 1 chart ]

A new 1 percent home loan product has quietly hit the market to help qualified, cash-strapped borrowers overcome one of the biggest obstacles to homeownership: downpayment. With significant variation in details, the 1 percent down mortgages offered by Quicken Loans and Guaranteed Rate stem from their partnerships with Freddie Mac and are structured as part of Freddie’s Home Possible Advantage program. In Quicken’s version, the borrower pays...

Last week, Ocwen Financial agreed to a $30 million settlement with the Department of Justice regarding two lawsuits that alleged violations of the False Claims Act. The lawsuits alleged that Ocwen Loan Servicing and Ocwen’s Homeward Residential division violated the FCA by falsely certifying their compliance with the Home Affordable Modification Program and FHA insurance programs, thus rendering all HAMP incentive and FHA insurance payments on Ocwen- or Homeward-serviced loans false claims. One of the cases was scheduled...

A top mortgage-industry executive called for the establishment of criteria for adjusting FHA mortgage-insurance premiums to limit taxpayer exposure and allow private capital to play a larger role in the mortgage market. In a recent blog, Patrick Sinks, president/CEO of Mortgage Guaranty Insurance Corp., noted growing talk in the mortgage industry of another possible FHA premium reduction following last year’s 50 basis point cut. However, before that happens ...

The sale of residential mortgage servicing rights has been gaining steam the past few weeks – unless you happen to be in the market for Ginnie Mae product. In particular, there’s a growing concern about price discounts on Ginnie servicing rights, and a strong belief that the agency – including its president, Ted Tozer – is once again getting anxious about so many nonbanks being such large players in the market. Tozer is so concerned about the matter that the agency – with the help of the Mortgage Bankers Association – is hosting what’s been described as a “liquidity summit” in Washington, DC, with several stakeholders and regulators, including officials from the Federal Reserve and U.S. Treasury. The summit, closed to the media, is scheduled for June 24. Ginnie issued...

FHA lenders will face stiffer maximum monetary penalties later this year for various violations of agency rules and regulations. The higher monetary penalties are the result of legislation signed into law late last year requiring federal agencies to adjust the current maximum penalty amounts for inflation in order to maintain their deterrent effect. Specifically, the Federal Civil Penalties Inflation Adjustment Act of 2015 (2015 Act) requires federal agencies to adjust the level of civil monetary penalties with an initial “catch-up” adjustment through an interim final rule and subsequent annual adjustments for inflation. The interim final rules with the initial penalty adjustments must be published by July 1, 2016. The new penalty levels must take effect no later than Aug. 1, 2016. Additionally, agencies are required to make annual inflation adjustments, starting Jan. 15, 2017, and for each year going forward. The adjustments will ...

FHA single-family forward endorsements fell by 8.0 percent in the first quarter of 2016 from the prior quarter, suggesting a continued slowing in endorsement in the latter part of 2015 and early 2016 compared to earlier quarters, according to the FHA’s latest quarterly report to Congress on the state of the Mutual Mortgage Insurance Fund. Overall though, the FHA MMIF report as well as FHA monthly production reports for March and April continued to show the very positive trends – rising volume, lower delinquencies and outstanding credit quality – that have been occurring in the FHA program since 2009. Endorsement volume for purchase and refinance loans was down to $53.5 billion during the first three months of 2016 from $58.1 billion in the fourth quarter of 2015, the MMI Fund report showed. Last year, forward endorsements soared in the second quarter and reached a record high in the ...

An FHA price reduction remains a possibility but its impact is likely to be limited, according to analysts at Keefe, Bruyette & Woods. While some industry observers might think another mortgage insurance premium cut is inevitable, there is no broad pressure from any group or coalition that would compel FHA to do so, said KBW analysts Bose George and Chas Tyson, both panelists at KBW’s Mortgage Finance Conference recently. Given last year’s 50-basis-point cut, the FHA’s ability to cut rates meaningfully is somewhat limited, they said. The FHA annual MIP is currently 80 to/or 85 bps, down from the pre-reduction premium of 130 to/or 135 bps and higher compared to the average annual premium of 50 to/or 55 bps before the financial crisis. If FHA decides to reduce the premium again, George and Tyson believe the floor will likely be at the pre-crisis premium level, which would suggest a ...

Ginnie Mae securitization of rural home loans got off to a wobbly start in the first quarter of 2016 as securitization volume fell 13.8 percent from the prior quarter, according to an Inside FHA/VA Lending analysis of Ginnie data. Approximately $3.9 billion in loans with a USDA guarantee were securitized during the first three months, with the top five issuers accounting for $2.1 billion of mortgage-backed securities produced by the segment during the period. USDA securitization volume dropped 9.2 percent year over year. Top USDA issuer Chase Home Finance accounted for $1.2 billion of securitized rural housing loans, while PennyMac, in distant second place, finished the quarter with $378.5 million. Wells Fargo ($294.0 million), Pacific Union Financial ($122.8 million) and Amerihome Mortgage ($102.2 million), in sequential order, comprised the rest of the top five issuers. Pacific Union climbed over ...