Ginnie Mae securitized fewer rural home loans guaranteed by the U.S. Department of Agriculture in the second quarter of 2015 compared to the previous quarter, according to analysis of agency data. A total of $8.4 billion of USDA loans were securitized during the first six months of 2015, down 2.1 percent from the same period last year. Securitization volume also dropped by as much quarter over quarter. Chase led all USDA securitizers with $2.6 billion in loans securitized during the first half of the year for a commanding 30.4 share of the market. Wells Fargo funneled $1.1 billion in USDA loans into Ginnie MBS, resulting in a 13.1 market share, while PennyMac delivered $609.7 million for securitization. U.S. Bank closed the first half with $260.3 million in securitized USDA mortgages despite a 31.4 percent drop in the second quarter. Pacific Union Financial rounded out the top five USDA loan securitizers with ... [ chart ]

Wells Fargo this week reinstated the 640 minimum credit score requirement, following through on its threat to re-impose credit overlays due to its frustration with FHA’s republished loan-level certification proposal. Officials said the re-proposed version of the proposal, which was initially issued for comment in May, still disappoints in spite of industry input to put concerned FHA lenders at ease (See next story for background). In 2014, Wells dropped the minimum credit-score requirement to 600 for FHA borrowers after talks with the Department of Housing and Urban Development and policymakers. The FICO readjustment applies to Wells’ FHA retail purchase loans, aligning it with the 640 minimum credit score requirement for the bank’s correspondent business. In a previous statement, Wells reiterated the need for clearer rules in order to ...

FHA lenders funded $7.8 billion in new Home Equity Conversion Mortgage loans during the first half of 2015, up 8.2 percent from the same period a year ago. HECM loan production was slower in the second quarter with originations down 1.1 percent from the prior quarter. Purchase loans accounted for 86.1 percent of all HECM transactions during the first six months. Interestingly, borrower bias against adjustable-rate loans appeared to have eased. Fixed-rate HECMs accounted for only 15.4 percent of originations during the first half of the year. Initial principal amount at loan origination totaled $4.6 billion over the same period. On a fiscal year-to-date basis, the FHA reported a total of 53,372 HECM endorsements, up from 47,662 HECM endorsements in fiscal YTD 2014. Meanwhile, HECM endorsed cases increased to 5,750 in August compared to ... [ chart ]

The Department of Housing and Urban Development recently saw its long-running attempt to recover $179 million from a bankrupt FHA lender come to a disappointing close, receiving only a little over half-a-million dollars after liquidation. HUD’s Inspector General gave the agency the green light to book its share of funds available to pay an $89.9 million HUD claim against the now-defunct lender Taylor, Bean & Whitaker, ending further action against the company. In 2006, whistleblowers filed a “qui tam” lawsuit in federal district court in Georgia alleging that TBW and Home America Mortgage had falsely certified and approved poorly underwritten loans for FHA insurance. In 2009, the two mortgage lenders filed for bankruptcy separately but were later consolidated by the court into one bankruptcy case. In May 2010, the Department of Justice, on behalf of HUD, filed a ...

Securitized FHA,VA and rural housing loans in Ginnie Mae mortgage-backed securities totaled $188.5 billion in the first six months of 2015, fueled by significant purchase and refinance activity, according to an Inside FHA/VA Lending analysis of Ginnie Mae data. An estimated $113.4 billion in FHA-insured mortgages were securitized during the first half of the year. Of that total, $60.6 billion were purchase mortgages and $44.2 billion were refinance loans. FHA purchase-loan production increased 58.8 percent in the second quarter from the prior quarter while refi lending jumped 160.8 percent over the same period as FHA’s reduced annual mortgage insurance premium began to take hold. The FHA loans that went into Ginnie MBS showed an average loan-to-value ratio of 92.8 percent and an average debt-to-income ratio of 39.7 percent. Borrowers’ average FICO score was 675.9, which was indicative of ... [ 2 charts ]

The VA Home Loan Guaranty Program has issued guidance to clarify the notification requirement applicable to all holders of VA repurchase and mobile-home mortgage loans. Under existing regulation, holders of VA repurchase and mobile-home loans are required to report to the Department of Veterans Affairs any event that leads to the full payment of a VA-backed loan. The guidance requires all holders to report the status of all VA repurchase and mobile-home mortgages upon full satisfaction of the loan. All notifications must be sent directly to the chief of contract assurance at nashpm.vbaco@va.gov. For further questions, contact Ronnie Lamb at ...

The FHA is developing standards that would allow FHA financing on homes with existing Property Assessed Clean Energy liens going forward. Specifically, the guidance would require subordination of PACE financing to first-lien FHA mortgages. The FHA is also working on a monitoring mechanism to track the number of PACE loans with FHA insurance in the future, said a HUD spokesman. Mortgage market analysts say FHA’s action could lead to broader adoption of the PACE program for FHA-insured single-family homes. The Mortgage Bankers Association, in a statement, applauded the move. “This modification should allow some homeowners to install energy improvements in their home but not impede the rights of the first lien, something the original PACE program failed to consider,” said David Stevens, MBA president and CEO. PACE programs allow local governments to raise bond-funded financing to ...

The Department of Veterans Affairs has adopted a final rule aligning the Home Loan Guaranty Program’s disclosure and interest-rate adjustment requirements with the servicing provisions in the Truth in Lending Act, as recently revised by the Consumer Financial Protection Bureau. The rulemaking will ensure VA remains consistent with other consumer finance and housing regulations governing adjustable-rate mortgages, the agency said. The rule is effective Sept. 11, 2015. The VA adopted without the change the rule as proposed on March 30, 2015. In this rule, VA adopted TILA’s minimum 45-day look-back period to clarify that lenders making VA ARMs must meet the statute’s minimum notification requirements. Specifically, disclosures and notifications must be provided to borrowers before an interest-rate adjustment. Lenders are required to adjust ARM rates based on the most recent ...

The FHA’s overall delinquency rate declined in the second quarter of 2015, although late payments increased in the 30-day and 60-day categories on a seasonally adjusted basis, according to the Mortgage Bankers Association’s latest national delinquency and foreclosure survey. The FHA, on the other hand, reported some variances in its delinquency data. The 90-day plus delinquency rate in June was down 30 basis points from March’s 6.42 percent on an unadjusted basis. Considering seasonal factors, the decline was just 2 bps. Results of the MBA survey showed FHA’s overall delinquency rate at 9.00 percent in the second quarter, down from 9.10 percent in the previous quarter, as the serious delinquencies (90 days or more) fell over the same period. On the other hand, the 30-day and 60-day delinquency rates for FHA loans were up by a combined 10 bps from the ...

Poor oversight of lenders participating in the Section 203(k) Rehabilitation Loan Mortgage Insurance Program has increased the risk to FHA’s Mutual Mortgage Insurance Fund by more than $1.2 million for 40 active loans, according to the Department of Housing and Urban Development’s Office of the Inspector General. HUD’s Office of Housing questioned the findings of its independent auditors, saying that 203(k) lenders are monitored closely despite the limited staff and resources. The IG recommended to HUD that lenders be required to support or indemnify the department for any future losses on the 40 loans and to reimburse actual losses on two 203(k) loans totaling $83,332. An audit of HUD’s oversight of the program uncovered alleged weaknesses in the monitoring of lenders for compliance with the 203(k) program. In addition, HUD did not always ensure that loan-to-value ratios were ...