Lenders will face higher penalties for violations of agency rules and regulations as the FHA and the Department of Veterans Affairs adjust their respective maximum civil monetary penalties for inflation. The adjustments are mandated by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, which also requires publication of an interim final rule showing the current and adjusted penalty amounts. Effective June 22, 2016, VA’s maximum civil monetary penalties for false loan guaranty certification increased from $10,000 to $21,563, and from $5,500 to $10,781 for fraudulent claims or statements in any VA program. Comments on the VA interim final rule must be received on or before Aug. 22, 2016. Meanwhile, the FHA also is making inflation adjustments for its maximum civil penalties through an interim final rule that will take effect Aug. 15, 2016, the day before the ...

A new Inside Mortgage Finance analysis reveals that nonbank mortgage lenders have dramatically increased their share of new production over the past two years. Nonbank lenders captured an impressive 48.1 percent share of mortgage originations during the first quarter of 2016, in a database of over 170 lenders. That was up from just 39.1 percent two years ago in early 2014, and 45.2 percent in the first quarter of 2015. While new first-lien origination volume by the 88 banks in the database fell 4.0 percent from the fourth quarter of 2015, the 81 nonbanks managed...[Includes two data tables]

CRT Capital Group has begun winding down its mortgage research division, Sterne Agee CRT, casting a shadow over publicly traded residential stocks and dashing the hopes of any nonbanks that were hoping to pull off an initial public offering this year. As one equities researcher told Inside Mortgage Finance this week: “It’s not fun being a stock analyst these days.” And commenting on the recent – and unexpected – drop in rates, he added: “Some of these firms may get smoked.” Four years ago, Sterne Agee was...

The Structured Finance Industry Group late last week published a final draft of the standards for due diligence firms to use when testing loans for compliance with the Truth in Lending Act/Real Estate Settlement Procedures Act disclosure rule. “The underlying premise of this documentation is to establish a best practices approach to pre-securitization testing logic that will drive the due diligence conducted by third-party review firms,” SFIG said. The RMBS 3.0 TRID Compliance Review Scope documentation addresses...

Ginnie Mae is once again getting anxious about the growing – and large – presence of nonbanks that service the agency’s MBS, fearing a liquidity crisis could erupt because some firms rely too heavily on “non-traditional and very sophisticated funding mechanisms.” In a statement issued to Inside MBS & ABS this week, Ginnie contrasted nonbanks to depositories “who traditionally were the primary issuers of Ginnie Mae MBS.” The agency added...[Includes one data table]

Mortgage-finance reform doesn’t look to be anywhere on the horizon, but at some point government policymakers will have to figure out what to do with trillions of dollars of Fannie Mae and Freddie Mac MBS if the two government-sponsored enterprises are put out to pasture. In fact, the transition to a new GSE single security that’s scheduled to start in 2018 could become a test run of sorts for the even bigger changes ahead, according to a paper published by the Urban Institute. Crafted by five mortgage-industry veterans, “A More Promising Road to GSE Reform” is centered on the creation of a new government corporation that would replace Fannie and Freddie. The National Mortgage Reinsurance Corp. would issue...

Standard & Poor’s lost a little market share in the business of rating non-mortgage ABS during the first quarter of 2016, but the firm still was the most active player in the market, according to a new ranking by Inside MBS & ABS. S&P rated 58.4 percent of the $41.42 billion of non-mortgage ABS issued in early 2016, down from its 61.5 percent share for all of last year and its 64.1 percent share back in 2014. The company’s strong suit was in vehicle-finance ABS, where it rated 64.7 percent of the market, by dollar volume. While S&P’s share was up slightly in a few categories, its stake in the credit card ABS segment fell...[Includes two data tables]

First-time homebuyers account for a growing share of home purchases, and even though housing inventory is limited, originations of mortgages for first-time homebuyers are up sharply. First-time homebuyers accounted for 40.8 percent of home purchases in May, according to results from the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. The share for first-time homebuyers, based on a three-month moving average, was the highest level seen in more than five years. “Demand from first-time homebuyers is...

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...

The outstanding supply of single-family MBS in the market fell slightly in the first quarter, but you have to go two paces to the right of the decimal point to see it. A new Inside MBS & ABS analysis indicates that outstanding MBS totaled $6.407 trillion as of the end of March. That was down 0.01 percent from the previous quarter, stalling a steady expansion of the market that took place in 2015. And with a modest 0.2 percent increase in total single-family mortgage debt outstanding, the modest contraction in MBS nudged...[Includes two data tables]