The U.S. Attorney for the Southern District of New York has announced a $53 million settlement agreement with JPMorgan Chase Bank to resolve alleged discriminatory lending through its wholesale broker channel in violation of the Equal Credit Opportunity Act and the Fair Housing Act. Filed last week in Manhattan federal court, the U.S. Attorney’s complaint accused Chase of improperly steering African-American and Hispanic borrowers into certain loan products and charging them higher interest rates and fees than comparable white borrowers between 2006 and 2009. During the period, approximately 360,000 brokered mortgage loans were delivered...

With President-elect Donald Trump set to take office and Republicans in control of Congress, trade groups representing banks reiterated calls for revisions to standards for qualified mortgages. Banks are pushing for QM status to be applied to any mortgage held in portfolio, even if the loans have characteristics that would otherwise make them non-QMs subject to greater liability. In a letter this month to leaders of Congress, Rob Nichols, president and CEO of the American Bankers Association ...

Mortgage default rates appeared to spike higher in the fourth quarter of 2016, according to a new analysis and servicer ranking by Inside FHA/VA Lending. Some 5.51 percent of FHA loans in Ginnie Mae mortgage-backed securities pools were reported as 30- to 60-days past due at the end of December. That was up 80 basis points from the previous quarter and was easily the highest default rate in the past three years. FHA default rates were also up in more serious delinquency categories: loans 60- to 90-days past due and those over 90-days late. The figures are based on loan count and are not seasonally adjusted. Similar trends occurred in the VA home loan guaranty program. The 30-60 category was up 41 bps, while 90+ delinquencies jumped 19 bps. The supply of Ginnie single-family MBS outstanding continued to set new records. The total, not including multifamily and FHA home-equity conversion ... [4 charts]

VA originations have been trending upward over several quarters, thanks to an unusually heavy share of refinance business, but all good things, at some point, must slow down, lenders say. The refinance business overall has fallen to 45 percent from 55 percent in the fourth quarter of 2016, and that will have an effect on VA originations in the first quarter of 2017, said Andy May, chief operating officer of the American Armed Forces Mutual Aid Association Mortgage Division. Going forward, May expects VA originations to fall by 10 percent in the first quarter due to rising interest rates. But even though rates have been trending up, May saw an uptick in VA loan applications in January as fence-sitters jumped into the market to take out a loan before rates went any higher. “The MBA estimates rates will rise above 5 percent in the next 24 months and then down to 4.8 percent by the end of 2018, and up to 5.3 percent at the ...

Effective Feb. 13, 2017, VA lenders will be required to submit prior-approval mortgage loans electronically through the WebLGY system to improve the prior-approval process. Currently, lenders mail their prior-loan approval packages to the regional loan center that has jurisdiction over loan underwriting – a tedious, time-consuming process. Electronic submission will help speed things up, the VA indicated. Lenders must follow the guidelines for prior approval and stacking order in the VA’s Lender Handbook. In addition, lenders must furnish a cover letter with the uploaded package stating the reasons for the prior approval and explaining any unique circumstances. The cover letter also must include the submitting underwriter’s name, phone number and email address as well as contact information for the underwriter’s manager. The lender must ensure that the file contains the correct and complete ...

The nation’s largest banks revealed better-than-expected residential origination figures (for some) and mouth-watering markups on the value of their servicing portfolios. That’s the good news. But it wasn’t all wine and roses. On the servicing front, BOK Financial revealed that fourth quarter income was reduced by $17.4 million because it left servicing-related hedges on the books for too long, betting that rates would stay low for an extended period of time. PNC Bank saw...[Includes one data table]

The Blackstone Group this month filed its long awaited initial public offering document on its Invitation Homes unit, a pioneer in single-family rentals and securitization of these assets. The 1,300 page Form S-11 is chock full of financial details on the real estate investment trust, including the revelation that the company continues to lose money. Through the first nine months of 2016 – the latest available data – Invitation Homes posted a net loss of $51.6 million compared to a $121.7 million loss in the same period a year earlier. The numbers and commentary in the filing indicate...

With interest rates up 75 basis points since the election – and staying there, at least for now – residential production is likely to slip in the quarters ahead, leading to layoffs, especially at firms that focus on refinancings. “It’s coming,” said industry consultant Don Henig, a former top sales executive for loanDepot, a top-10 ranked originator. “Maybe we haven’t seen too many layoffs quite yet, but just look at volume numbers and do the math.” Henig added: “Right now, a lot of shops ...

The recent run-up in mortgage rates appears to have suppressed short-term home purchase expectations among prospective homebuyers, who nonetheless otherwise feel optimistic about the housing market over the longer term, according to new data from government-sponsored enterprise Fannie Mae. Fannie’s latest Home Purchase Sentiment Index (HPSI), released earlier this week, dipped 0.5 points to 80.7, the fifth consecutive monthly decline. The index is down ...

While mortgage interest rates remain at historic lows, an increase of even one percentage point is not going to have a dramatic effect on affordability and any negative homebuyer response to rising rates is likely to be short-lived, according to a new Redfin survey. Even if mortgage rates climb to 5 percent, homebuyers would lower their expectations and shop for less expensive homes, said 49 percent of the 827 Redfin real estate agents who responded to the survey. Redfin conducted ...