The Mortgage Bankers Association has asked the Department of Housing and Urban Development to tweak its current re-inspection policy, which may be interfering with certain home-sale transactions. In a recent letter, the MBA asked HUD to realign its re-inspection policy with those of the government-sponsored enterprises and the VA to prevent it from hindering sales that were in progress prior to hurricanes Harvey and Irma but had not closed when the storms hit. The MBA said the current policy requires that the inspection be completed after the Federal Emergency Management Agency’s “incident period.” HUD interprets this to mean the end date of the incident period. Because such periods can run anywhere from a few weeks to a couple of months and could be reopened or extended, many borrowers face needless delay from completing a home sale, even where there is no ...

Industry Trade Groups Call for Compton Vote. A coalition of 28 trade groups representing the mortgage and real-estate industries has urged the Senate leadership to bring Paul Compton’s nomination as general counsel of the Department of Housing and Urban Development to the floor for a vote. The Senate Committee on Banking, Housing and Urban Affairs approved Compton’s nomination in July but no further action has been taken since. In a joint letter, the coalition underscored the importance of the role of HUD general counsel in the aftermath of hurricanes Harvey and Irma. The groups urged Senate Majority Leader Mitch McConnell, R-KY, and Senate Minority Leader Chuck Schumer, D-NY, to provide all the necessary resources to help in the disaster recovery and to put the HUD general counsel in place, which is critical to the recovery efforts. On Sept. 14, the Senate confirmed ...

LoanDepot has announced a key FHA disaster-related mortgage loan product to help families whose homes have been damaged or destroyed by hurricanes Harvey and Irma. Loans made through the FHA 203(h) Mortgage Insurance for Disaster Victims program are designed specifically for hard-hit homeowners in presidentially-declared major disaster areas (PDMDA) and can be used in tandem with a similar FHA product, the 203(k) property rehabilitation loan. Use of the 203(h) product spiked...

The Department of Housing and Urban Development has asked its internal watchdog to make some “minor adjustments” to its recommendations following recent audit findings of inadequate HUD monitoring of servicers’ loss mitigation activities. Commenting on the HUD Inspector General’s report, HUD asked for some minor tweaks so that it can best implement the IG’s recommended changes, which include revisions in the department’s monitoring policies and procedures, development of new policies and procedures for sharing new information, and indemnification and administrative actions. The IG undertook...

Issuance of non-agency MBS backed by newly originated home loans remains well below levels seen before the financial crisis. While new regulations have stopped some pre-crisis loan types from being originated, industry participants suggest that other major factors are also limiting the supply of loans available for MBS. Chris Helwig, a managing director at Amherst Pierpont, noted that banks are competing for prime jumbos and holding them in portfolio, and many borrowers who previously might have received subprime mortgages opt for FHA loans. “All that is left for non-agency MBS is...

Ginnie Mae and the Department of Veterans Affairs have created a joint task force to deal with improper early refinancing of VA loans – a practice the agencies thought they had eliminated but which has reemerged in the last couple of weeks. The task force will be monitoring closely monthly VA refinancing data and will develop additional policies to augment the current policy, which Ginnie, in consultation with the VA, issued last year to curb churning of VA loans in its MBS. Responding to concerns raised by Sen. Elizabeth Warren, D-MA, acting Ginnie President and Chief Operations Officer Michael Bright acknowledged...

Subservicing contracts topped $1.97 trillion at June 30, a 4.3 percent gain from March and a 28.2 percent jump over the past year, according to an exclusive Inside Mortgage Finance survey. Overall, roughly 19.9 percent of all residential loans are now being processed by these “outsourcing” vendors, who do not own the underlying strip of receivables and instead receive a portion of the servicing fee for doing all the grunt work. The subservicing sector continues...[Includes one data table]

The seasonal surge in primary market mortgage originations stood in stark contrast to a slump in new residential MBS issuance during the second quarter of 2017. Mortgage lenders originated an estimated $455.0 billion of new first-lien loans during the April-June cycle, an 18.2 percent increase from the first three months of the year, according to estimates by Inside Mortgage Finance. But the secondary market generated just $294.7 billion in MBS backed by purchase and refinance loans – a 5.3 percent decline. The result was...[Includes one data table]

Rapid, aggressive refinancing of VA loans has made a comeback with some issuers using strategies to mask the practice and avoid possible penalties, including expulsion from the Ginnie Mae program, according to a top agency official. Responding to concerns raised by Sen. Elizabeth Warren, D-MA, Michael Bright, acting Ginnie Mae president and chief operations officer, said a joint Ginnie Mae/VA lender-abuse task force is analyzing monthly data and developing additional policy measures to deal with the problem. Bright confirmed the resurgence of inappropriate streamline refinancing in Ginnie securitization pools in recent weeks and has promised to crack down on the questionable practice. The problem surfaced last year when Ginnie Mae noticed unusually fast prepayment speeds in its mortgage-backed securities, particularly MBS backed by VA loans. Ginnie found that certain lenders and ...

The White House this week officially nominated industry veteran Brian Montgomery to be the next FHA commissioner and assistant secretary for the Department of Housing and Urban Development. In a related development, the Senate on Thursday confirmed the nomination of Pamela Pantenaude as HUD deputy secretary, three months to the day the Senate Committee on Banking, Housing and Urban Affairs approved her nomination. Montgomery, currently vice chairman of the Washington-based business-consulting firm The Collingwood Group, is no stranger to the job. He previously served as FHA commissioner/HUD assistant secretary during the second Bush administration and as acting HUD secretary in January 2009. As FHA commissioner, Montgomery lead legislative efforts to preserve the nation’s affordable rental housing stock while reducing rental-assistance costs and the cost of ...