The Department of Veterans Affairs expects to have a finalized Qualified Mortgage (QM) rule by May to help clear up some issues that have arisen since the agency issued an interim final rule last spring. The VA issued the interim QM rule for comment on May 9, 2014, to define which VA loans will have QM status under the ability-to-repay (ATR) rule. Issued by the Consumer Financial Protection Bureau, the ATR rule provided temporary QM status to loans eligible for FHA insurance and guaranties by the VA and the Department of Agriculture’s Rural Housing Service. Eligible government-backed loans must be 30-year fixed-rate with no interest-only, negative amortization or balloon features. Total points and fees must not exceed 3 percent of the total loan amount for loans of $100,000 or more. Loans that meet the definition of a temporary VA-eligible QM are considered as in compliance with the ATR rule. They are designated as “safe harbor QMs,” provided they are not ...

Ginnie Mae servicing volume gained a mere percentage point in the fourth quarter of 2014 from the previous quarter, capping a productive year for servicers of government-backed mortgages, according to Inside FHA Lending’s analysis of agency data. Servicing volume rose by only 1.0 percent to $1.5 trillion during the last three months of 2014 from $1.4 trillion in unpaid principal balance in the first quarter, and increased 4.0 percent year over year. Four out of the top five Ginnie Mae servicers were banks, of which three experienced declines in their servicing portfolios on quarterly and year-over-year bases. The leader of the pack, Wells Fargo, closed out the year with $416.0 billion in Ginnie Mae servicing and capturing 27.8 percent of the market. Its servicing portfolio fell ... [ 1 chart ]

Issuer Performance Tool. Ginnie Mae expects to release its long-anticipated Issuer Operational Performance Profile system on or about Feb. 24. The IOPP system features a scorecard to measure an issuer’s compliance with Ginnie Mae standards and to compare its performance with those of its peers.Final Tier Ranking Scores. The FHA has issued a reminder that under the Tier Ranking System II (TRSII) Servicer narrative, all scored servicers – including those that have not opted out – may have their names and performance scores published on the Department of Housing and Urban Development’s Tier Ranking System page on HUD.gov at the end of each calendar year. The information is now available for review.TRSII scores servicer compliance with HUD/FHA delinquent servicing guidelines and requirements in the areas of delinquency intervention, loss mitigation based on ...

Private mortgage insurers ended 2014 in better financial shape and with a stronger market position than a year earler, although new business volume fell sharply in the fourth quarter, according to a new Inside Mortgage Finance analysis and ranking. Private MIs reported $46.94 billion in new insurance written during the fourth quarter of 2014, a figure that could change slightly when National MI releases its earnings after Inside Mortgage Finance goes to press. Our estimate for the firm is based on volume trends reported by its competitors. While private MI business was down 12.5 percent in the fourth quarter, total mortgage originations fell...[Includes three data charts]

In another example of tag-team enforcement, the Consumer Financial Protection Bureau last week moved against three small, nonbank mortgage companies over their allegedly deceptive advertising practices that implied some status as an agents of the U.S. government, or that they had the approval or endorsement of the government. The crackdown stemmed from a joint sweep with the Federal Trade Commission of about 800 randomly selected ads across the U.S., and as a result of consumer complaints filed with both agencies. In one of the cases, the CFPB filed...

Production of loans with a Department of Veterans Affairs guaranty increased 44 percent in the fourth quarter of 2014 compared to the same period a year ago, thanks to strong refinance activity during the holidays, according to an agency spokesman. John Bell, assistant director for loan policy and valuation with the VA Home Loan Guaranty Service, said VA streamline refinance activity rose 18 percent year over year as more veterans took advantage of lower interest rates and lower downpayment in the fourth quarter. He said the VA is still in the process of collating data, declining to give further details. Nonetheless, VA production in the fourth quarter was fueled...

A push to seize a few thousand underwater mortgages in the San Francisco area by eminent domain has likely run into a dead end for now, after a report from the City and County of San Francisco Controller’s Office discouraged local officials from pursuing the idea any further. “Precluding any participation from Fannie Mae or Freddie Mac, the use of eminent domain would seem to be an inviable option,” the document concluded. On Oct. 28, 2014, the Board of Supervisors issued...

Having a busy correspondent program helped many of the top agency mortgage sellers cultivate purchase-mortgage business in 2014, according to a new Inside Mortgage Trends analysis of loan-level data on loans securitized by Fannie Mae, Freddie Mac and Ginnie Mae. Mortgages originated by loan correspondents accounted for 35.3 percent of single-family loans securitized by the agencies last year. Retail originations were the ... [Includes two data charts]

The two best things about the mortgage origination market in the fourth quarter were that it meant 2014 wasn’t as bad as once feared, and that refinance demand had picked up. But a new Inside Mortgage Finance analysis and ranking reveals two other positive trends: the jumbo and home-equity markets continued to gain strength in the final three months of 2014. Lenders originated an estimated $67 billion of jumbo mortgages during the fourth quarter, up 3.1 percent from the previous period. Home-equity production bounced 5.0 percent higher, to an estimated $21 billion. Neither gain was...[Includes two data charts]

Department of Housing and Urban Development Secretary Julian Castro faced the wrath of the GOP majority during a House Financial Services Committee hearing this week on the state of the FHA, focusing on the agency’s recent decision to cut annual mortgage insurance premiums. While Castro may have been warned about stepping into the lion’s den, he appeared ill-prepared for the confrontation with Republicans, unable to answer basic questions such as FHA’s net income, overall delinquency rate and the serious delinquency rate for 2014. Democrats, on the other hand, helped the embattled secretary regain his footing by expressing support for FHA’s efforts and putting perspective on some of FHA’s actions to strengthen the Mutual Mortgage Insurance Fund and help qualify more borrowers for FHA credit. Committee Chairman Jeb Hensarling, R-TX, set...