Seterus, a servicing vendor working for Fannie Mae, foreclosed on 2,762 homes in California during 2017, more than any other servicer – by far – according to a report issued by the California Department of Business Oversight. The year prior, Seterus, which is controlled by IBM, foreclosed on 4,265 units, the state found. The figures cover only firms that are California licensees. The runner-up in California foreclosures last year was Nationstar Mortgage with 1,410 actions, down 15.4 percent from 2016.
Industry experts continue to weigh in on the White House’s proposal to privatize the GSEs and introduce multiple guarantors, but don’t anticipate action anytime soon. Analysts with Keefe, Bruyette and Woods said the proposed changes are similar to the Corker-Warner and Johnson-Crapo reform bills previously introduced in the Senate.
Freddie Mac will now allow borrowers purchasing or refinancing a condominium to take advantage of its appraisal waiver. With condominium loans growing in popularity among first-time homebuyers, the GSEs are purchasing more of the product. As a result, Freddie announced last week it decided to expand the eligibility requirements. Fannie Mae has been offering its property inspection waiver to condominium borrowers since May.
Routine financial transactions involving mortgages could face extreme headwinds under a new consumer data privacy bill passed last week in California. So much so that it prompted the Federal Housing Finance Agency to urge state lawmakers to consider the implications of the legislation to the mortgage market. The controversial consumer data privacy bill passed on June 28. It would allow consumers to opt-out of any type of data collection and give consumers the right to have any personal information deleted.
Pershing Square Capital Management, the largest holder of GSE common stock, is telling its shareholders to be patient with its investment in Fannie Mae and Freddie Mac, despite the drubbing the shares have taken this year. As Inside The GSEs went to press late this week, Fannie common was trading for $1.41 a share compared to a 52-week high of $3.31 and a low of $1.21. Freddie common was selling for $1.60. Its high for the year is $3.24, its low $1.20.
After industry feedback, Fannie Mae and Freddie Mac decided to reduce the amount of seller data required on the Uniform Closing Dataset. The UCD is part of an ongoing effort by the GSEs to create a common industry dataset to support the Consumer Financial Protection Bureau’s Closing Disclosure form. The GSEs said they’ve spent the past several months working with the industry to understand the challenges lenders have collecting certain seller-specific closing data elements.
Fitch Ratings has lowered its loss expectations by an average of 20 basis points for Fannie Mae and Freddie Mac credit risk transfers for the second half of the year. Strong collateral performance coupled with increased home price appreciation and a shorter term to maturity has led to the lower loss projections. In fact, Fitch noted that home prices in the respective pools have increased by 20 percent on average since issuance and 3.5 percent since January.
One think tank is encouraging buyers of manufactured homes to choose mortgages over chattel loans to make the transaction more affordable while potentially increasing supply and demand. While most manufactured home buyers choose the more expensive chattel financing – where the loan is based on the property not the land, the Urban Institute said a good number of these buyers would actually qualify for a mortgage.
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