Despite lower mortgage rates, MBS prepayment speeds slowed across the board in December, particularly for the recent low coupons, while speeds for higher coupons were up slightly, according to securitization analysts. Researchers varied slightly in their estimates, saying speeds for 30-year Fannie Mae securities slowed 2-6 conditional prepayment rate for the recent low coupons (3.5-4.5 percent from 2011 and 2010). Barclays Capital analysts attributed the slowdown to reduced refinancing activity during the December holiday season. The weighted average CPR for all Fannie Mae MBS declined to...

Veterans will be able to borrow up to a possible maximum of $625,500 in some high-cost areas to purchase or refinance a single-family house under the Department of Veterans Affairs’ loan limits for 2012. The amount of mortgage a veteran could qualify for would depend on the median county price and the VA’s new method for calculating loan limits on a county-by-county basis. In Hawaii, Guam, Alaska and the Virgin Islands, limits will range from $625,500 to as much $938,250, the agency said. A list of VA county loan limits has been posted on the agency’s web site. The VA does not have a maximum loan limit...

The number of FHA endorsements grew by a whisper in November, up 0.2 percent to 88,206 from 88,060 in October, and down a screaming 32.8 percent from last year, according to Inside FHA Lending’s analysis of agency data. Endorsements for the month totaled $14.5 billion, with purchases and first-time homebuyers leading the way. Approved lenders accounted for the bulk of originations during the month, 79.8 percent. Purchase transactions comprised 64.8 percent of total originations for the month. An estimated 96.1 percent of loans insured by FHA were fixed-rate mortgages. Purchase loans with FHA...

The FHA will continue to play a critical role in the nation’s housing markets in 2012 even as it tries to balance the need to extend credit while reducing its market share to open the way for private capital to return to the mortgage market, according to industry observers. That means walking a tightrope in trying to keep the Mutual Mortgage Insurance Fund actuarially sound while trying to avoid piling on more fees and additional restrictions, which could hamper housing recovery, observers said. “We can’t have an economic recovery without a housing recovery,” said Brian Chappelle, a mortgage industry consultant. “The philosophical debate about the role of government in housing should be ...

Bank of America and other large mortgage servicers are seeking a meeting with the Federal Housing Finance Agency to address concerns about the latest version of the Home Affordable Refinance Program for underwater Fannie Mae and Freddie Mac borrowers. Since HARP was first launched in 2009, it has failed to meet expectations. The government quickly expanded the program to include loans with current loan-to-value ratios of up to 125 percent, which accounted for a very small share of business. Under HARP 2.0, which went into effect this month but won’t be fully up to speed until the second quarter of...

Senate Republicans have threatened to block the confirmation of Carol Galante as head of the FHA until Senate Democrats come up with a plan to deal with Fannie Mae and Freddie Mac. The Senate Committee on Banking, Housing and Urban Affairs this week voted 13 to 9 to send Galante’s nomination to the Senate floor amid Republican calls to reject the nomination. Some Republicans expressed concern over the health of the FHA Mutual Mortgage Insurance Fund, citing a recent independent actuarial study that reported a precarious drop in the fund’s excess capital reserve for unexpected losses. Sen. Jim DeMint, R-SC, said he did not think ...

The recent change in the FHA’s maximum loan limits would have relatively limited impact for current borrowers trying to refinance, according to analysts. FHA loans insured prior to Oct. 1, 2011, were already grandfathered in for streamlined refinancing regardless of loan size, said analysts with J.P. Morgan Securities. In addition, the analysts said they do not expect many conventional jumbo-to-FHA refinances in this market segment because the mortgage insurance premiums make FHA loans less attractive. Last month, President Obama signed an appropriations bill into law, reinstating the pre-Oct. 1 formula for calculating the “temporary” loan limits for high-cost areas, which is ... [With one chart]

Ginnie Mae may have reported potentially inaccurate data to Congress about its exposures because estimates were not based on the best available data, according to a recent report by the Government Accountability Office. The agency’s sensitivity analysis also ignored important data, which could affect the accuracy of its cash-flow forecasts, the report said. Although Ginnie Mae has revised its cash-flow forecast model, it has not implemented practices identified in Federal Accounting Standards Advisory Board guidance and risk-budgeting guidance, the report noted. By ignoring such practices, Ginnie Mae’s model may not be ...

Ginnie Mae recently announced changes to rules implementing provisions under the Servicemembers’ Civil Relief Act for reimbursing excess mortgage interest to Ginnie Mae issuers. Under the revised SCRA reimbursement policy, issuers will be reimbursed excess interest payments on SCRA mortgage loans based on two different dates for reservists and active members of the military, said Ginnie Mae officials during an issuer outreach webinar on Dec. 8. If the borrower is a reservist, the reimbursement will be based on the date of the receipt of the deployment letter and reimbursements for active members will be based on the deployment date. Under the SCRA, mortgage lenders are required to ...

Total FHA endorsements declined 4.2 percent in October from the previous month and 29.7 percent from a year ago even as FHA refinances continued to slow, according to an Inside FHA Lending analysis of FHA data. A total of 88,060 mortgages were endorsed for FHA insurance in October, down from 91,963 loans in September. Of the October endorsements, 60,596 were purchase loans, down 9.0 percent from the previous month and 7.9 percent from the same reporting period last year. FHA refinancing increased 15.4 percent on a month-to-month basis but declined a whopping 57.9 percent from last year. Streamlined FHA refis were ... (Comes with one chart)