The FHA and VA reached a milestone of sorts in the second quarter of 2017 when both agencies hit their lowest delinquency levels in as many years, according to the Mortgage Bankers Association’s quarterly survey of mortgage delinquencies nationwide. The FHA delinquency rate fell to 7.94 percent from 8.09 percent in the first quarter on a seasonally adjusted basis, reaching its lowest level since 1996. Also on a seasonally adjusted basis, the VA delinquency rate declined to 3.72 percent from 3.90 percent in the previous quarter, the lowest it has been since 1979. Mortgage delinquencies also decreased for conventional loans on a seasonally adjusted basis. It dropped to 3.47 percent from 4.04 percent in the first quarter on a seasonally adjusted basis. Overall, the delinquency rate for mortgage loans on single-family residential homes fell to a seasonally adjusted rate of 4.24 percent of all ...

With speculation mounting that CFPB Director Richard Cordray could be out the door as early as the Labor Day weekend, the CFPB late last week announced it is amending the 2015 updates to the Home Mortgage Disclosure Act rule. The bureau has temporarily changed reporting requirements for banks and credit unions that issue home-equity lines of credit, and clarified the information that financial institutions are required to collect and report about their mortgage lending. Under the rules that are scheduled to take effect January 2018, financial institutions would have been required under HMDA to report HELOCs if they made 100 such loans in each of the last two years. The final rule issued this past Thursday increases that threshold to ...

Commercial banks and savings institutions have been steadily adding to their residential MBS portfolios, but they show significantly less interest in the non-mortgage ABS market. Total bank investment in non-mortgage ABS sank again in the second quarter, dropping by $5.05 billion from the end of March to $118.38 billion. Compared to a year ago, bank ABS holdings were down 9.6 percent and they’ve been in steady decline since the end of 2013. It’s...[Includes two data tables]

Even though indications of stress in the U.S. auto market are proliferating, risks in the auto loan ABS sector are still under control and investors are protected by healthy levels of credit enhancement, according to industry analysts. “Despite late-cycle indicators continuing to garner headlines – softer used-car pricing, rising inventories, weakening headline seasonally adjusted annual sales, and rising loan losses – we remain comfortable with auto loan ABS fundamentals,” according to a new report from Kroll Bond Rating Agency. KBRA did concede...

Fannie Mae and Freddie Mac are still titans in the residential MBS market when it comes to making new securities, but they have been forced to the sidelines as investors over nine years in conservatorship. The two government-sponsored enterprises held a combined $221.48 billion of residential MBS at the end of June. Firm numbers on the total volume of MBS outstanding at that point aren’t available yet, but it’s unlikely that Fannie and Freddie held more than 3.5 percent of the market. The two GSEs reduced...[Includes one data table]

Originations of non-agency jumbo mortgages increased in the second quarter of 2017, according to a new ranking and analysis by Inside Nonconforming Markets. But halfway through 2017, volume is lagging the production seen last year. An estimated $83.0 billion of non-agency jumbos were originated in the second quarter, up 18.6 percent from the previous period. In the first half of 2017, an estimated $153.0 billion of jumbos were originated, down ... [Includes one data chart]

Originations of nonconforming mortgages are increasing as lenders get more comfortable with the loans and seek to maintain production levels. Some $7.0 billion in nonconforming mortgages were originated in the second quarter of 2017, according to estimates by Inside Nonconforming Markets. The category includes nonprime loans, mortgages that don’t meet the qualified-mortgage test and other non-agency products, but it excludes prime jumbo loans. In our surveys ... [Includes one data chart]

JPMorgan Chase and Redwood Trust are set to continue their regular issuance of non-agency mortgage-backed securities, with deals scheduled to close on Aug. 30. The planned JPMorgan Mortgage Trust 2017-3 is a $1.02 billion deal, while Sequoia Mortgage Trust 2017-6 is sized at $355.4 million. Both of the MBS are predominantly backed by non-agency jumbo mortgages along with some loans eligible for sale to the government-sponsored enterprises. Rating services ...

Citadel Servicing Corp. recently launched a one-month bank-statement program for self-employed borrowers. While some lenders offer bank-statement programs, borrowers are typically required to provide at least one year of documentation. Citadel stressed that deposits into the borrower’s bank account aren’t the determinant figure to verify income. “Income is attested to and declared [by the borrower], a Citadel underwriter will confirm that ... [Includes three briefs]

Simplifying and aligning the default servicing policies of the conventional conforming and the government-backed mortgage markets would better serve the mortgage industry and homeowners, according to industry experts. In a recent discussion on how regulatory burden and high servicing costs might impede lending, members of the Mortgage Servicing Collaborative agreed on the need for streamlined and harmonized federal, state and agency policies and rules on servicing. Increased regulatory requirements have caused mortgage-servicing costs to skyrocket in recent years, experts said. Even though the quality of servicing has improved, the new regulations are complex and costly, they noted. Multiple pressures placed upon servicers have suppressed mortgage lending, making it harder for borrowers with tainted credit to obtain a mortgage, according to the ...