MBS analysts hold differing expectations as to what the potential replacement of the “temporary” head of the Federal Housing Finance Agency could mean to Fannie Mae, Freddie Mac and the mortgage securities sector. Recently reported Obama administration backchannel chatter suggests that the White House is actively seeking potential candidates to replace FHFA Acting Director Edward DeMarco, who has been the de facto agency chief since the departure of James Lockhart in September 2009. A report last week by Credit Suisse speculated...

The FHA this week announced additional measures to restore the financial health of its insurance fund and better protect consumers, including tighter underwriting on new FHA loans and elimination of a widely used standard fixed-rate reverse mortgage product. Acting FHA Commissioner Carol Galante unveiled the latest structural reforms in a Dec. 18 letter to Sen. Bob Corker, R-TN, who has repeatedly expressed concerns over the slow pace of reforms at FHA. The reforms address issues the senator raised with Department of Housing and Urban Development Secretary Shaun Donovan at a Dec. 6 Senate Banking, Housing and Urban Affairs Committee hearing on ...

A Senate vote on FHA reform legislation appears unlikely unless Senate Majority Leader Harry Reid, D-NV, and Senate Banking Committee Chairman Tim Johnson, D-SD, find a way to persuade Republican lawmakers to sign off on a House-approved bill before the end of the year, industry sources say. Senate Republicans are poring over the bill, H.R. 4264, the FHA Emergency Fiscal Solvency Act of 2012, which the House passed overwhelmingly 402-7. It is unclear how much Republican support the bill would have if – and when – it is taken to the Senate floor, said one trade group executive. The bill would strengthen the ...

As the wait for the highly anticipated “qualified mortgage” final rule continues, its impact on FHA lending programs remains uncertain. Concerns have been raised over the possibility that the final QM rule the Consumer Financial Protection Bureau is finalizing may establish a “safe harbor” for prime loans with a maximum debt-to-income ratio of up to 43 percent. This could have implications for FHA loans, which allow higher back-end ratios under certain circumstances, according to some lenders and industry participants. At what point the DTI ratios will ...

The FHA and VA have announced loan limit adjustments in many counties even as disparities with conventional loan limits persist in 2013, according to a new analysis by Inside FHA Lending. FHA loan limits for forward mortgages will increase in 2013 for 19 counties, 10 of which are part of the Houston metropolitan area. In those counties, the one-unit limit is going up just $1,500 to $272,550. The remaining counties are in Alaska. Congress authorized the “emergency” loan limits for high-costs markets – still $729,750 for FHA and $625,500 for Fannie Mae and Freddie Mac –to run through Dec. 31, 2013. The base loan limit nationwide and in ...

The Department of Housing and Urban Development reported strong note sales of more than $1.7 billion under the expanded Distressed Asset Stabilization Program (DASP) and announced another big sale in the first quarter of 2013. Preliminary results from the sale in September showed record participation among interested bidders on 13 pools. In total, the 13 pools went to 10 different entities, among them nonprofit and community-based organizations, according to HUD. While still in the process of settling the transactions, the FHA said it is very ...

Despite the renewed focus on the FHA in the wake of the recent actuarial report, analysts do not expect any meaningful action in 2013 given the important role that FHA plays in supporting the housing market. But that does not mean that the Department of Housing and Urban Development will be sitting idly by next year. It has a lot of additional measures to implement to protect and preserve the FHA Mutual Mortgage Insurance Fund, HUD Secretary Shaun Donovan told Senate lawmakers recently during a hearing on the condition of the fund. The changes are both ...

Wells Fargo Bank and Bank of America maintained their dominance in the FHA servicing market while the other institutions in the top five category held on to their respective market shares in the third quarter of 2012, according to the latest rankings by Inside FHA Lending. Except for some slight changes in the rankings, overall volume appeared flat during the quarter with no significant jumps or decline. The volume of mortgage debt outstanding with FHA insurance increased to $7.6 billion in the third quarter, up from $7.5 billion the previous quarter, with top-ranked Wells Fargo and second-place BofA accounting for ... [1 chart]

Ginnie Mae servicers reported a small increase in total production on a quarterly basis and a modest improvement year-over-year, according to an Inside FHA Lending analysis of FHA data. Third quarter servicing volume was up 2.1 percent to $1.3 trillion from the previous quarter and 9.7 percent from the same period last year. Not surprisingly, top-ranked Wells Fargo Mortgage and second-place Bank of America accounted for 52.0 percent of total production. Wells Fargo grew its Ginnie Mae servicing portfolio to $399.6 billion in the third quarter, 4.2 percent better than the previous quarter and a 17.4 percent improvement from a year ago. That bumped up Wells’ market share to ... [1 chart]

An FHA lender need not cancel a scheduled foreclosure sale to reassess a borrower if the property is non-owner occupied, vacant or an investment property, according to newly issued agency guidance. Under such circumstances, the lender does not have to cancel a foreclosure sale date because loss mitigation retention options are only available to owner-occupants, the FHA explained in a frequently-asked-questions guidance on the revised requirements for loss mitigation retention options. The FHA announced the changes last month in an effort to ...