Federal Housing Finance Agency Director Mel Watt this week unveiled two significant policy changes aimed at opening up the mortgage credit box: additional buyback relief for originators that sell loans to the government-sponsored enterprises and a return to Fannie Mae and Freddie Mac purchases of mortgages with loan-to-value ratios between 95 percent and 97 percent. Speaking at the annual convention of the Mortgage Bankers Association in Las Vegas, Watt gave some concrete details about the new “life of loan” representation and warranty relief and outlined a number of other changes in the works. Moreover, industry officials contend...
If Republicans take control of the U.S. Senate in the upcoming elections, Congress next year may actually produce some mortgage-related legislation, according to political analysts participating on a panel at the Mortgage Bankers Association’s annual convention in Las Vegas this week. Any successful legislation will be narrowly targeted and not address complex problems like building a new mortgage finance system or resolving the status of Fannie Mae and Freddie Mac, analysts agreed. Over the last four years, the Democrats’ top priority has been preserving...
An Iowa-based investor in government-sponsored enterprise common stock this week asked a federal court in the Hawkeye State to give “no weight” to a ruling earlier this month by a Washington, DC, federal judge who dismissed litigation against the government by other GSE shareholders, including Perry Capital and Fairholme Funds. Continental Western Insurance Co. filed papers in U.S. District Court for the Southern District of Iowa Central Division arguing that Judge Royce Lamberth was “simply wrong” in his interpretation of the Housing and Economic Recovery Act of 2008 and his HERA-based rationale to shut down shareholders’ suits in DC. An investor in GSE stock, Continental’s counsel in the case is...
High fees on FHA mortgages have helped push FHA’s market of financing for home purchases to the lowest level since the financial crisis, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. FHA mortgages were used to finance 18.2 percent of home purchases in September, based on a three-month moving average. That was down from a 21.9 percent share in September 2013 and 36.6 percent in May 2010, the highest level for FHA financing in the five-year history of HousingPulse. From 2008 through 2013, the Department of Housing and Urban Development increased...
We even heard one report that a non-QM firm is contemplating an initial public offering. It sounds crazy, we know…Meanwhile, it appears the states want a say in MSR transfers...
Waiting several years to unify Fannie Mae and Freddie Mac securities into a single MBS could pose a huge risk to its successful completion, warned the mortgage banking industry, but Wall Street thinks it’s worth the wait to get market participants totally behind the move. The Federal Housing Finance Agency’s proposed single security for the government-sponsored enterprises met with conflicting views as the comment period ended this week. The proposal is aimed at eliminating Freddie’s pricing disadvantage and improving liquidity in the to-be-announced market. The Securities Industry and Financial Markets Association urged...
The liquidity coverage ratio rule recently finalized by federal regulators will hinder the revival of the non-agency MBS market, according to industry participants. Non-agency MBS are not counted as high-quality liquid assets (HQLA) under the rule, reducing incentives for banks to hold the securities. The Structured Finance Industry Group and others raised concerns about the lack of an HQLA designation for non-agency MBS at a time when the Obama administration is working to revive the non-agency MBS market. “There are...
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