The modest rebound in the housing market during the second quarter of 2014 produced a solid increase in the volume of home loans with private mortgage insurance securitized by Fannie Mae and Freddie Mac. A new Inside Mortgage Finance analysis and ranking reveals that the two government-sponsored enterprises securitized $37.36 billion of single-family mortgages with private MI coverage during the second quarter. That was up 24.7 percent from the first three months of the year, which had produced a dismal $29.95 billion of MI-insured loans in new GSE mortgage-backed securities. By comparison, total GSE business was...[Includes two data charts]

Mortgage wholesalers are being extra careful these days on how much they pay loan brokers in a table-funding transaction to make sure they don’t run afoul of the points-and-fees cap on qualified mortgages set by the Consumer Financial Protection Bureau. According to interviews conducted by Inside Mortgage Finance over the past few weeks, table funders are capping those fees at anywhere from 2.20 percent to 2.75 percent. Some may go as low as 1.40 percent. The cap for qualified mortgage eligibility set by the CFPB under the Dodd-Frank Act is...

Recently implemented steps by the two government-sponsored enterprises to provide an alternative to repurchase when mortgage insurance is rescinded is a pleasant salve for a minor ailment, but it does nothing to address lenders’ chronic pain of sudden and unexpected buyback demands, according to a mortgage lender. Last week, new GSE repurchase requirements took effect, including the “MI stand-in” option, which Fannie defines as “the full mortgage insurance benefit that would have been payable under the original mortgage insurance policy if the mortgage loan liquidates.” In May, both Fannie and Freddie announced...

SunTrust Mortgage will pay $320 million to resolve a criminal investigation and allegations that the bank misled homeowners interested in the Home Affordable Modification Program, the Department of Justice announced late last week. In the first settled case of its kind, SunTrust allegedly misrepresented how long it would take to determine if a borrower was qualified for HAMP and how long the trial period would last. “Specifically, SunTrust made...

At the very least, MI firms must have $400 million in capital, and $500 million if the company is start-up mortgage insurer.

Marc Savitt, president of the National Association of Independent Housing Professionals, said he is seeing more lenders entering the wholesale channel. Most are nonbanks.

Over the past six months, many nonbanks have moved to sell MSRs as a way to remain cash flow positive in a tough origination market.

The most encouraging sign is that agency volume has been gaining pace. Production increased by 11.4 percent from May to June, with $76.48 billion in gross issuance.

Investors that have bought stock – and debt instruments – in the MIs are anxious about the phase-in period for the capital standards.

The Federal Housing Finance Agency will soon unveil capital rules for private mortgage insurers, introducing a risk-based standard based on loan-to-value ratios and other factors, while requiring parent companies to pledge assets to their MI subsidiaries if necessary, according to officials close to the matter. “Financial strength will be measured by comparing insured risk, on a risk-adjusted basis, against available assets,” said one official commenting under the condition he not be identified. The phrase “available assets” is key because it portends that liquidity must reside at the MI level and not at an affiliate of a parent company. It’s...