The biggest source of Fannie Mae and Freddie Mac business during the first five months of 2014 came from loans with high credit scores and loan-to-value ratios that don’t require mortgage insurance, according to a new Inside Mortgage Trends analysis. Some 34.0 percent of mortgages securitized by the two government-sponsored enterprises through May of this year had credit scores of 740 or higher and LTV ratios ranging from 61 percent to 80 percent ... [Includes one data chart]

Bayview Asset Management of Coral Gables, FL, is entering the mortgage origination business at a precarious time: Funding volumes this year could fall to just $1 trillion, one of the worst showings since the turn of the century. But that hasn’t deterred the privately-held company, whose investors include the well regarded BlackRock Financial. Since launching a correspondent purchase program a few months ago, Bayview has reviewed roughly $500 million in collateral, purchasing ...

Diversity and inclusion are no longer just a compliance issue, a window dressing or a matter of being “politically correct” but a corporate tool for achieving profits, attracting and developing new talent, and an appropriate response to an increasingly diverse marketplace, according to experts at an industry summit held in Washington, DC, this week. The three-day summit was organized by the Mortgage Bankers Association’s diversity and inclusion committee to ...

The Treasury Department announced this week that the Home Affordable Modification Program and related initiatives will be extended again, this time until at least the end of 2016. HAMP activity has declined fairly steadily since 2010 but received a boost recently due to changes by the FHA. “We need to be there for homeowners facing foreclosure, those who are struggling with increasing interest rates on their modified mortgages and those whose homes are ...

A spike in mortgage interest rates similar to what occurred in 2013 is possible, according to economists at the Federal Housing Finance Agency. The May-June 2013 spike caught many lenders off guard and put a crimp in mortgage banking profitability. The direction mortgage interest rates are likely to head is heavily tied to the anticipations of market participants, according to Saty Patrabansh, a senior economist at the FHFA, along with William Doerner and Samuel Asin ...

Secondary market mortgage sales – the lifeblood of mortgage banking income – declined sharply during the first quarter of 2014, according to an Inside Mortgage Trends analysis of bank call reports. Commercial banks and savings institutions sold just $125.7 billion in single-family home loans through their mortgage banking operations during the first three months of this year. That was down 31.1 percent from the fourth quarter and marked the slowest ... [Includes one data chart]

The Federal Housing Finance Agency late last week announced it reached a nearly $100 million settlement with RBS Securities to settle allegations tied to non-agency MBS bought by Freddie Mac from 2005 to 2007, but the deal represents just a fraction of the firm’s remaining exposure. The $99.5 million settlement only resolves claims against RBS in FHFA v. Ally Financial Inc. in the Southern District of New York. Ally Financial is the successor company to GMAC-RFC, a now defunct non-agency MBS issuer.

Several top-tier commercial banks increased their holdings of first-lien mortgages during the first quarter of 2014, according to a new ranking and analysis by Inside Nonconforming Markets. The growing portfolios were largely due to jumbo mortgages along with some conforming loans. Banks and thrifts held $1.74 trillion in first-lien mortgages in portfolio at the end of the first quarter of 2014, down 0.7 percent from the previous quarter ... [Includes one data chart]

SunTrust Mortgage’s recent settlement of a dispute with the federal government and 49 state attorneys general over defective FHA loans and Wells Fargo’s losing bid to quash a similar lawsuit are raising concerns about doing business with the FHA. Industry attorneys say the lesson for lenders in these recent industry debacles is that it is “extraordinarily dangerous” to do FHA loans these days given the outcome of the two cases. It is also getting harder to trust mortgage settlement agreements with the government, they added. “The scariest part in all these is the combination of government forces involved in these claims – state AGs, Department of Justice, Department of Housing and Urban Development and the Consumer Financial Protection Bureau,” said an attorney, who worked on both cases. “When they want to get you, they can get you.” Others believe these developments could have a ...

Two federal agencies have announced separate actions to protect reverse mortgage borrowers and rural home purchasers from deceptive advertising and marketing. This week, the FHA warned lenders participating in the Home Equity Conversion Mortgage program not to use misleading or deceptive language in marketing FHA-insured reverse mortgages to consumers. The FHA said the guidance is intended to protect HECM borrowers from advertising and presentations that appear to limit their options rather than informing them of the full range of available HECM products. Underscoring senior borrowers’ “freedom of choice,” FHA Commissioner Carol Galante said the agency wants lenders to know their marketing and advertising practices are under constant surveillance to prevent customers from being steered to unsuitable reverse mortgage products. Galante noted the ...