The Office of Management and Budget has cleared a proposed rule setting qualified mortgage standards for FHA-insured single-family mortgages for issuance in the coming weeks. The OMB signed off on the proposed standards on Sept. 12 and the Department of Housing and Urban Development has a few more refinements to perform before publishing the proposal for public comment. HUD declined to discuss the contents of the proposed standards or indicate a timetable for a final QM rule. Industry participants, on the other hand, said they would be surprised if ...

Mortgage lenders reported originating $2.01 trillion in home-purchase and refinance mortgages during 2012, a 43.7 percent increase from the prior year, according to a new Inside Mortgage Finance analysis of Home Mortgage Disclosure Act data released this week. Because HMDA data typically capture a relatively small share of home-equity originations and some small lenders don’t report at all, the total originations number for last year was somewhat higher. Interestingly, the origination volume grew...[Includes one data chart]

An estimated 86.4 percent of new mortgage originations were packaged into MBS during the first half of 2013, according to a new Inside MBS & ABS analysis. Despite some growth in the non-agency jumbo market, primary market lenders remain focused on production that they can safely securitize through Fannie Mae, Freddie Mac and Ginnie Mae. Securitization rates generally climb...

Commercial banks and savings institutions held a total of $1.528 trillion in residential MBS in portfolio as of the end of the second quarter, down 2.1 percent from the end of March, according to a new analysis and ranking by Inside MBS & ABS. Combined bank/thrift investment in MBS has been under steady pressure since the Federal Reserve resumed buying massive amounts of new agency MBS. The second-quarter decline brought the industry’s total MBS portfolio to its lowest point in two years. The one area where banks and thrifts have beefed up...[Includes two data charts]

A widely-expected reduction in conforming loan limits for 2014 would help the jumbo market continue to broaden its footprint in mortgage originations, but the impact would be largely confined to a handful of states, according to a new Inside Mortgage Finance analysis. Jumbo production – originations of home loans that exceed varying conforming loan limits around the country – has been the brightest spot in a mortgage outlook made increasingly gloomy by rising interest rates. Non-agency jumbo originations rose 9.3 percent from the first to the second quarter, while total originations of Fannie Mae, Freddie Mac and FHA loans fell 3.8 percent. Jumbo mortgages accounted...[Includes four data charts]

Two years ago, no megabank in its right mind would dare originate a jumbo mortgage without asking for at least a 20 percent downpayment – unless the borrower was a special client of the company’s wealth management division. Today, it’s a different story. As refi volumes begin to dwindle, a handful of large banks are loosening their jumbo underwriting standards, allowing for lower downpayment requirements and higher debt-to-income ratios. Wells Fargo has been offering...

A number of lenders in July stopped offering mortgages with characteristics outside of those allowed for qualified mortgages, according to the Mortgage Bankers Association. The MBA said credit availability declined in August after four months of loosening. “The slight decline in the Mortgage Credit Availability Index in August reflected a reduction in the availability of certain loan features, particularly interest-only and terms exceeding 30 years,” said Mike Fratantoni, the MBA’s vice president of research and economics. “As these loan features are outside of the QM definition, these changes may reflect the beginning of QM implementation, and the fact that Fannie Mae and Freddie Mac are limited to acquiring loans that meet the QM definition.” The MCAI is...

If the Federal Housing Finance Agency lowers loan limits for Fannie Mae and Freddie Mac next year, Redwood Trust says it is ready, willing and able to pick up the slack. “If that happens, Redwood will step up and fund those loans, no problem,” said Mike McMahon, managing director of the real estate investment trust, the most active jumbo MBS issuer in the non-agency market. The executive told Inside MBS & ABS that he’s certain that Redwood would have plenty of company as well. “There will be little or no disruption in the market,” he said. According to McMahon, in 2012 lenders produced...

The U.S. Justice Department has subpoenaed documents from Clayton Holdings LLC, once Wall Street’s largest mortgage due-diligence firm, as investigators eye-ball the due diligence that was performed on residential MBS deals in the run-up to the financial crisis. According to Bloomberg, the Justice Department presented a subpoena to Clayton on July 1, requesting an extensive amount of documentation having to do with the firm’s work on such deals. The DoJ is apparently seeking internal communications related to a review of pools of loans, due-diligence reviews performed by Clayton, as well as all communication between the clients for whom the company performed such reviews and the employees with which they dealt. The subpoena is...

Stewart Information Services, which has made a name for itself in the title insurance space, has purchased most of the assets of Allonhill, LLC, a due-diligence firm that conducts reviews on non-agency loans feeding jumbo MBS. No purchase price was disclosed on the sale. As Inside MBS & ABS went to press, both companies were saying little about the sale outside of a short press release. Due-diligence sources familiar with the deal say...