A new financing program for home energy retrofits that leverages home equity is gaining popularity among California homeowners despite efforts by the Federal Housing Finance Agency to discourage lenders from offering such products. Called the HERO program, the initiative was developed jointly by West Riverside Council of Governments and Renovate America, a San Diego-based company that works with local governments in designing low-cost financing programs for home and business owners that want to ...

When Fannie Mae and Freddie Mac were placed in government conservatorships in September 2008, roughly 600 banks and thrifts saw $8 billion of their preferred stock investments in the two GSEs evaporate. With both firms now wildly profitable, there is increasing hope and speculation that buyers of the “junior” preferred stock are in for an eventual payday. No one is more optimistic about that happening than the Independent Community Bankers of America. For the ICBA, the question boils down to how much on the dollar its members will receive for the shares they still own. It’s also a complicated question. When Fannie and Freddie hit the skids at the nadir of the housing bust, many banks and thrifts sold their preferred shares at market rates, that is, at something close to zero. In other words, they no longer have the stock certificates and any ownership rights. Speculators and bottom feeders do.

Organizers behind a recently filed White House petition are calling for the government to “restore fairness” to Fannie Mae and Freddie Mac common shareholders. Created on June 1, the petition posted on the White House website calls for Congress, the Treasury Department and the Federal Housing Finance Agency, to enact a method “to provide fairness and protection” to common shareholders of the two GSEs “and enable shareholders to have participation in the recovery of the value of their stock.” GSE common shareholders became entangled in a financial limbo of sorts when Fannie and Freddie were placed into government conservatorship under the FHFA in September 2008.

An increase of 10 basis points in the guaranty fees charged by the government-sponsored enterprises would make pricing for agency execution comparable to pricing for non-agency mortgage-backed security issuance, according to industry analysts. Agency g-fees averaged about 50 bps at the end of 2012, with plans for further increases this year. “The economics of non-agency securitization are much closer to GSE securitizations today than they were two years ago,” according to analysts at Barclays Capital ...

FirstREX is offering a slight wrinkle on “80-10-10” loan structures by taking an equity stake in the home, recording a second lien, while foregoing monthly payments from the borrower. It remains to be seen whether its “HomeBuyer” product will catch fire nationally. The privately held firm is helping consumers buy a home by providing up to half the downpayment. In marketing materials, the company is careful to point out that it isn’t a lender and that its program shouldn’t be construed as being part of a ...

Lenders are at odds with housing finance agencies over the benefits of a new FHA guidance, which calls for documentation of downpayment assistance (DA) that HFAs provide to borrowers. The new guidance requires mortgagees to show written proof that funds provided by a federal, state or local government entity to help borrowers meet the FHA’s 3.5 percent minimum cash investment requirement actually came from the entity and not from some impermissible source. The guidance follows up on a rule issued by HUD last year clarifying an interpretation of the National Housing Act. The rule expressed HUD’s view that ...

A recent Federal Reserve survey of bank lending practices further confirmed a continuing trend among FHA lenders of refusing to lend to borrowers with FICO scores below 620 even though they qualify for the loan and could afford the required minimum 3.5 percent cash investment. About a third of senior loan officers who responded to the April 2013 survey indicated they were less likely to approve FHA home-purchase loan applications within the 580-620 FICO range this year compared to last year. They prefer lending to borrowers with a 720 FICO and who are making a 10 to 20 percent downpayment, the survey showed. An estimated 75 percent of banks cited the ...

The Texas House of Representatives has approved legislation that will let voters decide on Nov. 5 whether to allow home-equity purchase lending in the Lone Star State. The bill would amend the Texas constitution to authorize Home Equity Conversion Mortgage for Purchase loans, which would make the program available to Texans for the first time. The state legislature voted 139 to 1 in favor of Senate Joint Resolution 18, which the Texas Senate approved unanimously in March. Specifically, the bill would amend the state constitution to ... [One chart]

Wall Street raised no objections to a Ginnie Mae proposal to consolidate its two mortgage-backed securities programs, indicating the move would be good for securitization and result in other positives. However, there appeared to be no consensus among players on how to get there. Representatives of Ginnie Mae and the Securities Industry and Financial Markets Association met early this month to discuss the agency’s proposal. Analysts agreed it is far too early in the game to discern a clear path towards a single Ginnie Mae MBS program and that implementation is likely years away. Nevertheless, there were ...

Ginnie Mae servicers reported a small increase in servicing volume during the first three months of 2013, with Ocwen Loan Servicing posting the largest gains from last quarter and from a year ago. Servicers held a total of $1.33 trillion in government-backed mortgage debt outstanding at the end of the quarter, up a notch from the fourth quarter and 8.2 percent more than the total Ginnie Mae servicing debt a year ago. Though Ocwen was fifth in the ranking with $36.08 billion, its servicing volume was up more than 1000 percent both from the last quarter and from the same period last year. Among the top Ginnie servicers, only ... [One chart]