Two real estate investment trusts with jumbo mortgage correspondent and conduit operations have scaled back their activity due to strong competition from banks. “The majority of today’s jumbo mortgage activity is being driven by banks originating or acquiring loans for their balance sheet,” said Stanford Kurland, chairman and CEO of PennyMac Mortgage Investment Trust. PennyMac had ramped up its jumbo activity in the second quarter of 2013 with $107 million in fundings. In the third quarter of 2013 ...
There are pockets in the jumbo market that offer lenders attractive yields, if they are willing to take on the risk of originating loans that don’t meet qualified-mortgage requirements, according to Matthew Ostrander, CEO of Parkside Lending. The lender recently launched Parkside Mortgage Trust, a real estate investment trust that will purchase non-agency loans originated by Parkside. “Parkside’s analytics of loan performance and product development has been many years in the making to ensure our ...
Interest rates are set to increase for a significant number of borrowers that received loan modifications after the financial crisis. Incentive payments to borrowers and servicers will also end, which could prompt performance issues on outstanding loan mods. The majority of mortgages modified under the Home Affordable Modification Program include interest rate resets after five years, and some proprietary loan mods followed a similar model. A relative trickle of resets will occur in 2014, followed by a massive ...
Increases to guaranty fees under consideration by the Federal Housing Finance Agency would directly reduce the dollar volume of new agency originations by less than 1.0 percent, according to new research published by the Federal Reserve. The g-fee increases were announced in December by Ed DeMarco, the acting director of the FHFA at the time, partly to increase the non-agency share of mortgage originations. The planned increases were put on hold by Mel Watt, the new director of the FHFA, and remain ...
The Consumer Financial Protection Bureau is preparing to comply with a mandate from the Dodd-Frank Act and collect more data under the Home Mortgage Disclosure Act. Among the additional HMDA data requirements under consideration are whether a mortgage meets qualified-mortgage standards, debt-to-income ratios, the length of introductory interest rates and more underwriting and pricing information. “Improving the kinds of information collected would make it easier to identify new consumer ... [Includes four briefs]
Buoyed by improvement in FHA loan quality, some lenders have begun lowering the credit score requirements for FHA and other government-backed mortgages. Last month, Wells Fargo alerted FHA lenders of its decision to lower the minimum credit score for purchase home loans through its retail channel from 640 to 600. “We felt it was an appropriate time to do it given the improvement in FHA loan quality,” a spokesman explained. “The change applies to all FHA borrowers. Last year’s resolution of the FHA indemnification issue also prompted the change at Wells Fargo, according to a bank official. In addition, resolving the putback risk with ...
New York regulator Lawsky raised concerns about the servicing cost-savings long touted by Ocwen, which are achieved via technology and employees largely located outside of the U.S.
Credit Suisse late last week broke a two-month lull in jumbo MBS issuance, and JPMorgan Chase appears to be planning a new security. However, the jumbo MBS market is far from flourishing as other issuers continue to avoid the sector. Credit Suisse issued a $287.42 million jumbo MBS last week. CSMC Trust 2014-IVR1 received a AAA rating from DBRS with credit enhancement of 6.85 percent on the top-rated tranche. The deal had...
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