The supply of home-equity loan debt outstanding has been in such a steady decline since 2007 that even the mild revival in new lending has been unable to stop. At the end of June, there was $585.09 billion of HEL debt outstanding, including home-equity lines of credit and closed-end second mortgages. That was down 0.7 percent from March. The vast majority of those loans, some $556.94 billion, were held in portfolio by banks, savings institutions and credit unions. There was...[Includes three data tables]

Drawing to a close, the third quarter of 2017 is turning out to be modestly better than some lenders expected with both profits and production volumes getting a second wind recently thanks to falling interest rates. “We’re having a great quarter,” said Mat Ishbia, president and CEO of United Wholesale Mortgage, Troy, MI. According to Ishbia, not only will UWM post record originations of $8.6 billion in the third quarter, but volume at the privately held nonbank will be about 20.0 percent higher than ever before. According to figures compiled by Inside Mortgage Finance, UWM is...

Anecdotal and empirical evidence confirm that mortgage lenders are continuing to lighten up on their underwriting criteria. The loosening may not be as pronounced as it was in the run-up to the financial crisis, but there are concerns that it will intensify as the Federal Reserve raises interest rates. Fannie Mae’s latest mortgage lender sentiment survey found that more lenders said they have eased credit standards than tightened them, something the government-sponsored enterprise attributed to limited demand for residential finance and a negative outlook on profit margins. “The net share of lenders reporting easing of credit standards over the prior three months has continued...

Issuance of non-agency MBS backed by newly originated home loans remains well below levels seen before the financial crisis. While new regulations have stopped some pre-crisis loan types from being originated, industry participants suggest that other major factors are also limiting the supply of loans available for MBS. Chris Helwig, a managing director at Amherst Pierpont, noted that banks are competing for prime jumbos and holding them in portfolio, and many borrowers who previously might have received subprime mortgages opt for FHA loans. “All that is left for non-agency MBS is...

The seasonal surge in primary market mortgage originations stood in stark contrast to a slump in new residential MBS issuance during the second quarter of 2017. Mortgage lenders originated an estimated $455.0 billion of new first-lien loans during the April-June cycle, an 18.2 percent increase from the first three months of the year, according to estimates by Inside Mortgage Finance. But the secondary market generated just $294.7 billion in MBS backed by purchase and refinance loans – a 5.3 percent decline. The result was...[Includes one data table]

Most rated residential MBS in regions affected by Hurricanes Harvey and Irma have limited exposure that will mitigate the losses resulting from the devastation, according to rating services. Residential MBS rated by Moody’s Investors Service, including securities backed by single-family rental properties, have minimal exposure to the storm-affected counties of Texas and Louisiana thereby easing the losses due to reduced property values, rising delinquencies and longer foreclosure and liquidation timelines, the rating agency said. The analysis is...

Redwood Trust is set to issue its first jumbo mortgage-backed security backed predominantly by loans with looser underwriting standards than the super-prime jumbos that have dominated the market. The planned $316.49 million Sequoia Mortgage Trust 2017-CH-1 includes many non-qualified mortgages and other loans that fall outside of Redwood’s traditional Select program. Kroll Bond Rating Agency and Moody’s Investors Service assigned preliminary AAA ratings to the MBS last week ...

Bank and thrift holdings of first-lien mortgages continued to increase in the second quarter, according to a new ranking and analysis by Inside Nonconforming Markets. Banks and thrifts held $1.97 trillion of first-lien mortgages at the end of June. The holdings were up by 1.9 percent from March and up 3.8 percent from a year ago. Trends in portfolio management were somewhat mixed among the top 10 holders of first-lien mortgages. Top-ranked Wells Fargo had ... [Includes one data chart]

Caliber Home Loans is on track to nearly double its originations of non-qualified mortgages this year and will supply the collateral for a forthcoming mortgage-backed security, the largest in the post-crisis era.Caliber plans to originate $1.00 billion of non-QMs this year, up from $539.0 million in 2016, according to DBRS. The nonbank lender has boosted its non-QM production across lending channels, led by wholesale. Caliber had $247.0 million in wholesale non-QM originations ...

The retail channel dominates production among prominent jumbo lenders and gained some market share through two quarters this year, according to a new analysis by Inside Nonconforming Markets. The retail channel accounted for 77.5 percent of jumbo originations among a group of lenders that had a total of $108.00 billion in jumbo volume in the first half of 2017. The retail share was 76.6 percent over the same period in 2016. The correspondent ... [Includes one data chart]