Housing finance reform, especially if it weakens mortgage underwriting standards, could have a negative impact on private-label MBS as well as the government-sponsored enterprises’ credit risk-transfer transactions, according to a newly published report from Moody’s Investor Services. Analysts said that various reform proposals could reduce the influence that Fannie Mae and Freddie Mac have in the market and likely increase credit risk in new MBS in the short-term. Combined with a rising interest rate environment, such reform could have a credit-negative effect. Loan origination processes and the kinds of loans produced could become...
Some 53.7 percent of newly originated mortgages delivered into agency mortgage-backed securities programs last year were generated through lenders’ retail production operations, according to a new Inside Mortgage Trends analysis. Correspondents accounted for the next largest share, 33.4 percent, of loans sold to Fannie Mae, Freddie Mac and Ginnie Mae. The data exclude mortgages that were over six months old when they were securitized ... [Includes two data charts]
New originations of home-equity loans were up 8.0 percent in 2016 from the previous year, but the market peaked early and ended with consecutive quarterly declines in production, according to a new Inside Mortgage Finance ranking and analysis. Lenders originated an estimated $197.6 billion of home-equity lines of credit and closed-end second mortgages last year. It was the strongest output since 2008, but it was not enough to offset the years-long erosion of second-mortgage debt. At the end of 2016, the supply of outstanding home-equity loans fell...[Includes three data tables]
Although 2017 is expected to be a down year for originations, Freedom Mortgage – already a top-10 ranked lender – is poised for growth via mergers and acquisitions and is pondering deals for both servicing rights and other shops. Company CEO and founder Stanley Middleman told Inside Mortgage Finance bluntly: “We’re shopping.” Although Middleman declined to name any targets, he said...
Two months after it was revealed that Fannie Mae would provide $1 billion in financing to single-family rental operator Invitation Homes, certain factions of the mortgage industry are starting to yell “charter creep.” Moreover, the National Association of Realtors and other trade groups are complaining that perhaps Fannie is spending too much of its limited resources helping Wall Street – the Blackstone Group grubstaked Invitation Homes initially – and not enough to help the first-time homebuyer. “What’s...
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