FHA originations rose significantly in the first quarter of 2016 from the same period last year even as VA loan production decreased slightly, according to an analysis of Ginnie Mae data. Lenders delivered $54.4 billion of FHA-insured loans to Ginnie Mae for securitization during the first three months, up 36.2 percent from the previous year. In contrast, the volume of VA loans securitized over the same period, $35.0 billion, fell 1.5 percent compared to the same period a year ago. A strong purchase-mortgage market drove FHA activity from January to March. The reduction in FHA’s annual insurance premium in January 2015 continued to have an impact on FHA’s purchase-loan market share. In 2015, FHA purchase originations accounted for $151.0 billion of the estimated $881.0 billion in total purchase originations (conventional and government single-family forward originations), according to ... [ 2 charts ]

Two major banks recently launched their own 3 percent downpayment programs, which stakeholders say could shift volume from FHA to the government-sponsored enterprises. How much volume though remains unclear, analysts say. Last week, Wells Fargo and JPMorgan Chase rolled out their respective low downpayment programs for first-time homebuyers and low-to-moderate-income families, which require only 3 percent down. Neither program involves the FHA, and they appear designed to pick up where Wells and Chase left off when they decided to cut back on their FHA business in order to reduce liability risk. Wells and Chase are among several major banks and nonbanks that have coughed up billions of dollars in settlements with the federal government in the last couple of years to resolve allegations of fraud under the False Claims Act and violations of ...

New Day USA, an exclusive VA lender, is building up its purchase mortgage-lending platform to help grow its VA business by the end of 2018, according to the firm’s top financial adviser.Based in Fulton, MD, New Day is developing its purchase-lending capability to help grow its overall VA business by 20 to 25 percent annually, said Joseph Murin, New Day’s chairman emeritus. “We’re growing slowly,” he said. “We’d rather walk before we run.” An approved VA lender, New Day’s focus has been almost entirely on cash-out refinancing. New Day currently ranks 21st among Ginnie Mae VA sellers for the first quarter of 2016, according to Inside FHA/VA Lending’s database. The company closed the first quarter with $463.1 million in VA loans, up 22.8 percent from 4Q15 and up a whopping 87.6 percent on a year-over-year basis. “We are spending a lot of time developing and understanding the ...

Eleven lenders paid a total of $152.1 million in civil penalties and settlements while three others lost their FHA approval for various violations of FHA requirements, according to the Mortgagee Review Board’s latest report on administrative actions taken against FHA-approved lenders. As required by the Department of Housing and Urban Development, the report summarizes the disciplinary actions imposed by the board on FHA lenders from Oct. 1, 2014, to Sept. 30, 2015. These actions include $151.7 million in settlements and $370,119 in civil money penalties, withdrawals of FHA approval, suspensions, probations and reprimands. Allied First Bank of Oswego, IL, agreed to pay a $17,000 civil money penalty for improper use of FHA’s name in certain correspondence and for failure to notify HUD of a consent order entered into by the bank and federal and state banking regulators. The MRB voted to ...

The whole-loan trading market has become more dynamic as more loan originators get approval to sell directly to the agencies while still having the option to deal with aggregators, industry insiders said during a panel at the recent secondary market conference sponsored by the Mortgage Bankers Association. “It’s an over-saturated market for correspondent buyers,” said Michael Quinn, executive vice president for correspondent products at PennyMac Financial. There are about ...

Large losses suffered by nonbank mortgage companies in the first quarter of 2016 have contributed to concerns about the companies’ ability to fund their operations. In a report published last week, analysts at Bank of America Merrill Lynch noted that mortgage servicing rights are the primary assets for nonbank servicers. Low interest rates have prompted markdowns to MSRs under generally accepted accounting principles. “Lower MSR valuations ... [Includes one data chart]

Commercial banks and savings institutions reported a sharp decline in mortgage-banking income during the first quarter of 2016, according to a new analysis of call-report data by Inside Mortgage Trends. In aggregate, banks earned $3.31 billion on mortgage banking during the first quarter. That was down 26.8 percent from the previous period and it marked the lowest quarterly profit in nearly five years. Back in the second quarter of 2011 ... [Includes one data chart]

Private investors – and even some public ones – are maintaining a strong interest in nonagency/nonprime lenders as well as “fix-and-flip” financers, but that doesn’t always mean raising capital is easy. California Capital Real Estate Advisors, or CALCAP, has been trying to raise $100 million since late last year, but recently ended talks with an investor based in San Francisco, said company principal Mark Mozilo. Mozilo, though, hardly seems worried, telling Inside Mortgage Trends ...

Battered by a landslide of new regulations and the aftermath of an historic meltdown in the housing market, the mortgage industry also faces a dramatic shift in market demand from demographic changes and new generational attitudes. Although the overall U.S. homeownership rate has been sinking, the ownership rate for Hispanics actually went up in the fourth quarter of last year, said Marisa Calderon, executive director of the National Association of Hispanic Real Estate Professionals ...

Commercial banks and thrifts boosted their combined holdings of residential MBS to a new record, $1.661 trillion, during the first quarter of 2016, according to a new Inside MBS & ABS analysis. The data include held-to-maturity and available-for-sale accounts, but not trading assets, which included another $45.99 billion of residential MBS as of the end of March. The banking industry’s MBS holdings in HTM/AFS portfolios rose 1.0 percent from the end of 2015, and they were up a substantial 5.2 percent from a year ago. It’s worth noting that total assets in the banking industry actually rose a bit faster, by 2.1 percent, dropping the MBS share of total assets down slightly to 10.2 percent. Unlike some quarters, when activity by one or two dominant banks accounts for most of the industry’s change, the first-quarter increase was...[Includes two data tables]