The FHA's recently updated manual underwriting standards provide some objective criteria for qualifying more borrowers but, at the same time, some of those standards could bar certain people from obtaining an FHA mortgage, according to compliance experts. A key change in the guidelines is the lowering of the credit score threshold from 620 to 580 to allow manually underwritten borrowers – those that have received a “refer” recommendation from FHA’s Total Mortgage Scorecard or those that were not scored because they did not have credit scores – to use compensating factors in order to ...
Program eligibility is one of the top five reasons a loan can get an “unacceptable” rating in a post-endorsement technical review of a targeted sample of FHA loans. In a sample review conducted by FHA between July 1, 2013, and Sept. 30, 2013, 10 percent of the 6,692 targeted loans were defective due to program eligibility. Of that 10 percent, 76 percent were rated unacceptable by FHA. The results reflect the initial rating of each file reviewed during the quarter, which include conforming, deficient and unacceptable. An unacceptable rating may change if the lender submits mitigating documentation to FHA. But even if subsequently mitigated, the fact ...
FHA endorsements fell 25.1 percent in the third quarter of 2013 from the previous quarter as interest rates roller-coastered and refinancing lost steam, according to Inside FHA Lending’s analysis of FHA data. After delayed reporting for two months, the FHA also released data showing a 27.9 percent decline in new endorsements in November from October, with lenders reporting $8.7 billion in total originations for the month. Purchase mortgages accounted for 77.1 percent of November’s FHA volume. Fixed-rate mortgages comprised 97.2 percent of total originations for the month. On a quarter-to-quarter basis, production fell to ... [2 charts]
Ginnie Mae, Japan Sign Joint MOU; Russia Gets Help In Launching First MI. Ginnie Mae is helping Japan and Russia transition from their current secondary mortgage market structures to the U.S. company’s model. On Jan. 9, Ginnie Mae and Japan Housing Finance Agency signed a joint memorandum of understanding to exchange information and help Japan create a securities program tailored after Ginnie Mae’s successful mortgage-backed securities program. Japanese Prime Minister Shinzo Abe has directed the JHFA to make the transition within three to five years. Under the MOU, the two countries will hold ...
Citigroup marked up the asset value of its MSRs by 5 percent, on a sequential basis, to $2.718 billion. Compared to 4Q12, its MSRs are now worth 40 percent more - even though its overall portfolio has been shrinking in size.
It’s likely that little in the way of money is changing hands on the deal. By selling the MSRs to Fannie, Citi is also settling the payment of “compensatory” fee claims the GSE is owed by the bank.
According to figures compiled by Inside Mortgage Finance, Flagstar is the nation’s second largest wholesale/broker lender. It also has a fairly large presence in the warehouse market.
Last week’s appointment of four special advisors to the Federal Housing Finance Agency by new Director Mel Watt has primed speculation of a policy-course correction at the FHFA but specific changes remain anyone’s guess, say industry observers. Watt added three current and former Obama administration officials into the agency’s fold “to provide counsel on policy and strategic decisions” at the agency while retaining an advisor from former FHFA Acting Director Edward DeMarco’s tenure. Two of the posts appear to represent new areas of focus for the agency – consumers and industry relations – that were often friction points under DeMarco. Bob Ryan, a former Freddie Mac executive, joins...
Expect Fannie Mae and Freddie Mac shareholders to continue to clamor for attention and satisfaction this year whether or not the Obama administration and lawmakers confront claims that the government-sponsored enterprises should share their profits with investors, say industry observers. Late last week, Sen. Bob Corker, R-VA, sought to walk back comments he made regarding GSE shareholder rights while speaking at a policy forum in Washington, DC. Corker said that he and other lawmakers drafting an enhanced GSE reform bill in the Senate recognize that shareholder claims “have to be dealt with.” Following news of Corker’s remark, GSE preferred shares posted...
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