But the most telling sign of how the banking industry has lost its grip on home lending rests in the number of depositories that rank among the top 20…
Holdings of first-lien residential mortgages by banks and thrifts increased in the first quarter of 2018, according to a new ranking and analysis by Inside Nonconforming Markets. Banks and thrifts held $2.025 trillion of first-lien home loans as of the end of the first quarter, up 0.5 percent from December 2017 and up 4.8 percent from March of last year. Trends varied somewhat among the 10 largest holders of first liens, with some posting large gains on an ... [Includes one data chart]
Originations of adjustable-rate mortgages declined in the first quarter of 2018 from the previous period, according to a new ranking and analysis by Inside Nonconforming Markets. ARM production slowed even with a rise in interest rates, and the products don’t appear to be popular with borrowers seeking purchase mortgages. An estimated $44.0 billion of ARMs were originated in the first three months of the year, down 20.0 percent from the fourth ... [Includes one data chart]
The credit risk profile of incoming FHA business has shifted significantly since the beginning of last year, according to a new Inside FHA/VA Lending analysis of Ginnie Mae mortgage-backed securities data. The biggest development has been the growth of loans with high debt-to-income ratios. There has also been a significant increase in the share of refinance loans that are cash-out transactions. FHA officials are well aware of these developments, having publicly mentioned them in testimony on Capitol Hill and at industry conferences. Officials have also raised concerns about FHA loans with downpayment assistance, although the MBS data don’t seem to indicate that there has been much change on that score. Among FHA loans endorsed in April and May, only 41.9 percent were at or below the benchmark DTI test for qualified mortgages, which is 43 percent. Through 2015 and 2016, well over half of new ... [Chart]
The issues behind the Department of Housing and Urban Development’s draft FHA condominium rules are “too complex” but lenders may expect a final rule in September, said HUD Secretary Ben Carson. Carson’s announcement of a release date for the long-anticipated condominium rules eases the mounting pressure on the secretary and the department to finalize the draft rules. On June 18, 54 senators and 120 members of the House signed a letter urging Carson to implement the changes in H.R. 3700, the Housing Opportunity Through Modernization Act, which would ease FHA requirements for financing condo purchases and refinancings. The bill was signed into law on July 29, 2016, and HUD published a proposed condo rule two months later. “We have been pushing it,” Carson said during a House committee oversight hearing this week. “It is a complex issue because when you are talking ...
Ginnie Mae will be working with FHA, VA and the U.S. Department of Agriculture to standardize origination policies and requirements for digital mortgages as it moves into the digital age of its secondary market business. Ginnie will coordinate with the agencies while developing technical standards for electronic closings, digital mortgage instruments and electronic vaults. All this work is part of the agency’s three-year strategy, Ginnie Mae 2020, to modernize its mortgage-backed securities program and platform, strengthen its counterparty risk management capability, and explore new ways to lower or eliminate risk from the system. As part of the modernization effort, Ginnie envisions a process that would allow it to accept digital promissory notes and other digitized loan files as eligible collateral for its MBS. It would encompass loan application through securitization. The plan calls for gradual implementation of ...
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