Increasingly worried about the financial condition of its largest nonbank issuers amid declining market conditions, Ginnie Mae in late October shot off a liquidity letter to 14 companies, asking them to develop contingency plans. The identity of the firms was not revealed to Inside FHA/VA Lending, but it’s no secret which companies rank among the top echelon of issuer/servicers. The five largest nonbank Ginnie MBS servicers as of Sept. 30 are PennyMac Financial Services, Lakeview Loan Servicing, Freedom Mortgage, Quicken Loans and Mr. Cooper. According to the letter, a copy of which was obtained by this publication, Ginnie wants the companies to develop strategies to right-size their operations. One of the agency’s goals is to lay the groundwork for financial stress tests that all issuer/servicers eventually must meet. Ginnie expects to sit down with the executive management teams of the ...
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 ...
The Department of Veterans Affairs has issued guidance clarifying the effect of guaranteed claim payments on a veteran’s home-loan entitlement. According to the guidance, a veteran loses a part or all of his VA home-loan benefit when the agency pays a claim on a loan terminated by a foreclosure, short sale or deed-in-lieu of foreclosure. For VA loans originated on or after Jan. 1, 1990, the VA will no longer establish debts against veterans after it pays a claim to reimburse a servicer for its loss. Reimbursement could be up to the maximum guaranty amount. On the other hand, the agency may establish a debt against the veteran and pursue collection if the loan was originated prior to Jan. 1, 1990. If the veteran wants to reuse the VA home-loan benefit, he or she must fully reimburse VA for its losses in order to restore full entitlement. The loss only affects the veteran’s entitlement under the VA Home Loan guaranty program and ...
Although Impac Mortgage Holdings lost $142.8 million over the past two quarters, company management continues to be bullish on its future, laying the groundwork for a further expansion into the non-qualified loan market.
One New Jersey-based loan officer told IMFnews, “It’s very un-nerving right now.” He noted that on a recent workday he had account executives from three different companies come into his office. “One of them, I hadn’t seen in a year.”
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