The House Financial Services Committee last week spent three days marking up the Republican majority’s alternative to the Dodd-Frank Act. H.R. 10, the Financial CHOICE Act, introduced late last month by committee Chairman Jeb Hensarling, R-TX, would make a number of changes to the mortgage regulatory landscape. One provision would provide a safe harbor against litigation for residential mortgages held on the lender’s balance sheet since the origination of the loan if the mortgage fails to comply with ability-to-repay requirements. The measure also would revise the definition of “points and fees” under the Truth in Lending Act to exclude fees paid for affiliated business arrangements. Other language in the bill would exempt smaller creditors from TILA’s escrow requirements. Another provision ...

As the House Financial Services Committee prepared to begin marking up the Financial CHOICE Act last week, the Consumer Mortgage Coalition warned lawmakers that the bill would actually interfere with fixing the problems with the CFPB’s mortgage rules, despite the improvements it would otherwise make in the regulatory landscape. “A major problem facing the mortgage industry today is the Rube Goldberg morass of CFPB regulations that are so poorly written that no one knows how to comply,” the CMC said in a letter to lawmakers prior to the hearing. “The mortgage markets will not heal until the CFPB mortgage regulations are fixed. Fixing the regulations requires revising them through the normal notice and comment rulemaking process.” The problem, however, is ...

Rep. Andy Barr, R-KY, last week re-introduced the Portfolio Lending and Mortgage Access Act (H.R. 2226), legislation that aims to expand access to mortgage credit by conferring qualified mortgage status upon loans originated by a bank and held in portfolio. The bill sponsor also hopes that it will discourage the practices that led to the 2008 financial crisis and the resulting taxpayer bailouts of Fannie Mae, Freddie Mac, and too-big-to-fail financial institutions. The legislation had some bipartisan support when Barr introduced it in the previous Congress, passing the U.S. House of Representatives by a vote of 255-174. However, the measure never made it out of the Senate Banking, Housing and Urban Affairs Committee. Supporters hope this time around will be ...

Nearly all publicly held commercial banks and savings associations continued to generate a profit on their mortgage banking activities during the first quarter of 2017, but in most cases it was less than they earned in the past, according to an exclusive analysis and ranking by Inside Mortgage Trends. A group of 26 national banking organizations and regionals reported a combined $2.295 billion in mortgage banking income for the first quarter. Not all institutions ... [Includes one data chart]

The updraft in mortgage interest rates following the November election has bolstered the secondary market in mortgage servicing rights, and business could quicken even more if independent mortgage bankers feel profit pressure from declining margins, according to industry experts. There are more bidders in the market than last year, said David Bennett, a managing director at MountainView Capital Holdings, during a panel session at this week’s secondary market conference ...

There are sharp differences in compensation structures for loan originators who work out of retail branches and those in the consumer-direct business, according to Strategic Mortgage Finance Group. Stratmor, an advisory firm, recently released details from its most recent “compensation connection” survey, covering compensation in 2015. The results focused on traditional retail LOs and consumer-direct LOs who tend to focus on call-center/online originations. Retail LOs were found to ...

Lack of basic information and knowledge about the application process and concern about rising interest rates are reasons why most homeowners are reluctant to take out home-equity lines of credit to meet their financial needs, according to a study by mortgage solutions provider Digital Risk. A company survey of 1,038 homeowners found that 21 percent have no clue what a HELOC is, while 45 percent did not even know how to apply for one. Sixty-five percent said they ...

Bank of America has made a break from most of the other big banks in terms of sending conforming mortgages to the government-sponsored enterprises. Officials at the bank said BofA is retaining more of its GSE-eligible loans, though the strategy can result in short-term decreases to mortgage-banking income. “We believe retaining these mortgages will provide better economics over time, plus retention deepens our relationship with these customers,” Paul Donofrio, BofA’s chief financial officer ...

Holdings of non-agency mortgage-backed securities by most banks and thrifts are declining, according to a ranking and analysis by Inside Nonconforming Markets. Banks and thrifts held $63.00 billion of non-agency MBS as of the end of 2016, down 23.9 percent from the end of 2015. The holdings are concentrated among five banks, which accounted for 64.9 percent of all non-agency MBS held by the industry as of the end of 2016. JPMorgan Chase held ... [Includes one data chart]

Mortgage default rates for FHA and VA loans followed seasonal trends and shifted significantly lower in the first quarter of 2017, according to a new analysis and servicer ranking by Inside FHA/VA Lending. While both portfolios showed strong growth in the dollar volume of loans outstanding in Ginnie Mae mortgage-backed securities, there were also huge declines in the number of loans past due. Some $1.036 trillion of FHA forward mortgages were in Ginnie pools at the end of March, up 1.1 percent from the previous quarter. But delinquency rates for the less-severe categories of late payment were down sharply. The number of FHA loans 30-60 days past due, for example, declined by 28.4 percent, lowering the delinquency rate by 1.51 percentage points, leaving it just about where it was a year ago. The same thing happened in the VA sector. Total VA supply grew 3.2 percent to ... [Charts]