Home-equity lending remains one of the soft spots in the mortgage market, as the supply of loans outstanding continued to shrink and new lending volume remained anemic in the third quarter. [Includes three data charts.]

Negative equity – or even just the perception of it – is the most important determinant of default rates, according to a recent study by Collateral Analytics.

Retail originations declined more than third-party production in the three major mortgage-product categories during the third quarter of 2018, according to a new analysis by Inside Mortgage Trends. Based on survey data from a broad cross-section of lenders, retail originations fell 8.8 percent from the second to the third quarter. The wholesale-broker sector was down 1.9 percent, while correspondent production posted a 1.9 percent increase. The data ... [Includes two data charts]

The correspondent channel has continued to gain market share of jumbo mortgages as production of such loans has shifted to purchase financing, according to a new analysis by Inside Nonconforming Markets. Correspondents accounted for 21.7 percent of third-quarter jumbo mortgages originated by lenders that report data to Inside Mortgage Finance. The sector’s market share has increased for three consecutive quarters. Correspondents accounted... [Includes one data chart]

The threshold for what constitutes a jumbo mortgage will increase by 6.9 percent in 2019 as the Federal Housing Finance Agency set new loan limits this week. The baseline conforming loan limit for the government-sponsored enterprises will increase to $484,350 from $453,100 in 2018, and for most high-cost areas, the limit will rise to $726,525 from $679,650. The FHFA annually adjusts loan limits for mortgages delivered to Fannie Mae and Freddie Mac based on its home price index ...

Most major servicers of jumbo mortgages increased their portfolios in the third quarter, according to a new ranking and analysis by Inside Nonconforming Markets. Combined, 30 servicers handled an estimated $1.06 trillion of jumbo mortgages as of the end of September, up 2.7 percent sequentially and 10.7 percent from a year ago. Only four of the servicers posted lower jumbo portfolios on an annual basis, and one of the firms, Ocwen Financial, is under ... [Includes one data chart]

Among the top 15 servicers of subprime mortgages, only one grew its portfolio over the 12 months prior to the end of September, according to a new ranking and analysis by Inside Nonconforming Markets. The increase was posted by Citadel Servicing Corp., which is boosting its portfolio with originations of nonprime mortgages. Citadel handled a subprime portfolio with an unpaid principal balance of $1.80 billion as of September-end. The portfolio grew ... [Includes one data chart]

Two mortgage-backed securities with non-qualified mortgages originated by Impac Mortgage Holdings are in the works, according to presale reports released last week. An affiliate of Starwood Capital Group plans to issue a $280.0 million MBS with loans solely originated by Impac, while Deephaven Mortgage plans to issue a $374.3 million deal with production from 77 lenders, led by Impac with a 14.7 percent share. Among nine mortgage-backed securities ... [Includes two briefs]

Home Equity Conversion Mortgage originations saw a modest 4.7 percent sequential fall in the third quarter as the downward volume trend for reverse mortgages continued. [Includes one data chart.]

The Department of Housing and Urban Development is planning to conduct an inventory of occupants of homes with a Home Equity Conversion Mortgage loan originated prior to 2014 to help protect non-borrowing spouses from eviction in the event of the HECM borrower’s death. The status of non-borrowing spouses (NBS) remains an issue with HUD relative to HECM books of business predating 2014, when the program did not provide protections to spouses of deceased HECM borrowers, FHA Commissioner Brian Montgomery said during a press briefing this week. Prior to August 2014, only borrowers over the age of 62 could be on the HECM note and on the title of the home. The policy created a problem for non-borrowing spouses, who could face eviction if the older spouse passed away. The HECM borrower’s death is deemed a “maturity event” that renders the loan due and payable. This meant that the ...