Risk weights established by the Basel Committee on Banking Supervision for holdings of securitized assets won’t have much of an impact on U.S. banks, according to analysts at Barclays Capital. It’s unclear which banks the risk weights will be applied to and many U.S. banks have transitioned to similar methods to evaluate capital requirements for their holdings of MBS and ABS. The BCBS issued a revised framework for calculating risk weights on banks’ securitization exposures in December. The framework is set to take effect in certain countries beginning in 2018. It was issued to address concerns that banks were holding insufficient capital for certain securitized assets and to reduce the reliance on external ratings to derive securitization risk weights. Barclays said...

Fourth-quarter earnings reports from the four megabanks in the mortgage industry suggest that loan production activity and mortgage banking income fell slightly at the end of 2014. On a combined basis, Wells Fargo, JPMorgan Chase, Bank of America and Citigroup originated $88.7 billion in home mortgages during the fourth quarter of 2014, according to a new Inside Mortgage Trends analysis of earnings reports released this week. That total was down ...

New single-family business at Fannie Mae and Freddie Mac declined 2.1 percent during the fourth quarter of 2014, but you can’t blame it on mortgage brokers. The two government-sponsored enterprises securitized $20.53 billion of broker loans over the final three months of the year, up 3.7 percent from the third quarter, according to a new Inside Mortgage Trends analysis of loan-level mortgage-backed securities data. That gave broker loans a ... [Includes one data chart]

Home purchase borrowers, including first-time homebuyers, rely more on their lender or mortgage broker than anyone else as a source of information about mortgages, according to a new government survey on consumers’ mortgage shopping experience. Conducted by the Consumer Financial Protection Bureau, the survey found that an estimated 70 percent of home-purchase borrowers chose their lender or broker before deciding on the type of loan ...

A number of factors, including looser underwriting standards, low interest rates and low oil prices, could help bolster the housing sector in 2015, according to industry analysts. However, total mortgage originations are still expected to decline this year compared with 2014, and consumer confidence toward the housing market is lagging optimism about the broader economy. Analysts at Fitch Ratings recently pointed to a “confluence of events” that could ...

The executive suites of mortgage banking firms are well represented by members of the “baby boom” generation who aren’t getting any younger. And therein lies a potential problem. “Millennials certainly appear to be under-represented in the mortgage industry, while members of the baby boom and Gen X generations appear to be over-represented,” said Glen Corso, executive director of Community Mortgage Lenders of America. The way Corso sees it ...

This year could be a watershed moment for mortgage lending as industry representatives feel their way around a brand new approach to closing disclosures, thanks to the pending implementation of the integrated disclosure rule from the Consumer Financial Protection Bureau. As a result, it’s likely that more lenders will assume greater control over the closing process as well as the end product. The new closing form is “unlike anything the industry has seen before ...

Commercial banks and thrifts originated $89.88 billion of home mortgages through their retail production channels during the third quarter of 2014, a healthy 7.7 increase from the prior quarter, according to a new Inside Mortgage Trends analysis of call-report data. That brought year-to-date retail originations by banks to $236.57 billion, off 55.5 percent from the first nine months of 2013. Bank and thrift retail originations appeared to trail the overall market ... [Includes one data chart]

The Obama administration this week announced a half-percent reduction in the annual mortgage insurance premiums all borrowers will have to pay for an FHA-insured forward mortgage loan. In a press briefing, Department of Housing and Urban Development Secretary Julian Castro said the annual MIP willd be lowered from the current 1.35 percent to 0.85 percent – a difference of 50 basis points – to enable more creditworthy first-time homebuyers to purchase their homes. Approximately 250,000 new homeowners will benefit from reduced premiums over the next three years, saving them an average of $900 annually, Castro said. He further estimated that lowering the annual MIP will make homeownership more affordable for more than 2 million borrowers over the three-year period. The upfront fee of 1.75 percent and the current requirement that borrowers continue paying premiums for the life of the loan were ...

Despite reduced guaranty limits in more than 80 counties, recent changes to the VA mortgage limits in 2015 will have no material impact on veteran borrowers or hurt credit availability, according to industry analysts. In enacting the omnibus spending bill, Congress reduced the maximum size of mortgages guaranteed by the VA, matching it to the $625,500 high-cost loan limits for Fannie Mae, Freddie Mac and FHA. The change took effect on Jan. 1, 2015, affecting 82 counties, some seeing as much as a 40 percent reduction in the VA loan limit. For example, loan limits in the New York area fell by 36.1 percent and in the Washington, DC, area, lenders saw a 9.7 percent decline, according to estimates by the Urban Institute. The VA home loan program does not require a downpayment and the guaranty is limited to 25 percent of the loan amount. In certain cases, the program allows a veteran to ...