The average FHA credit score in the second quarter of 2014 continued to decline from the record highs of 2011, but remains well above the levels preceding the mortgage and credit crisis, according to FHA’s latest report to Congress on the state of the agency’s Mutual Mortgage Insurance Fund. The FHA’s second-quarter average credit score of 680 was 3 points below the previous quarter’s score and 13 points below the score during the same period last year. The report’s data suggest that FHA has accomplished its goal of shifting its market share to the 620-679 credit score bucket consistent with its target market while ceding its share of loans with scores exceeding 720 to the private MI sector. The last time borrowers’ average credit score hit 680 was in the second quarter of 2009. FHA officials said they are working to have 75 percent of the FHA lending in the ...

The Department of Housing and Urban Development is now qualifying investors for its sixth auction of non-performing loans (NPLs) amid nationwide protests calling for reform of HUD’s distressed note sale program. Single-Family Loan Sale SFLS 2014-2 includes 15,232 single-family, non-performing mortgages with a total unpaid principal of $2.3 billion. The sale consists of 10 loan pools ranging from $97 million to $825 million with collateral dispersed across the country, according to loan sale advisor DebtX. It is scheduled to bid on Sept. 30. On June 11, HUD sold a $4.8 billion portfolio of NPLs, the first of a two-part sale. The national offering consisted of approximately 23,200 loans divided into 16 pools ranging from $93 million to $1 billion. The loans are backed by properties across the ...

The first-quarter decline in FHA jumbo production spilled over into the second quarter as volume dropped another 21.7 percent, ending the first half of the year with $4.7 billion in new government-insured jumbo loans, according to an Inside FHA Lending analysis of agency snapshot data. On a year-over-year basis, volume fell 56.7 percent over the six-month period compared to the same period last year. Jumbo loans make up a tiny percentage of FHA’s overall portfolio. The FHA has been weaning itself away from jumbos after Republican members of Congress accused the agency of straying from its mission by subsidizing purchases of million-dollar houses. A statutory readjustment this year brought the FHA loan limit in high-cost areas down to $625,500, the same level as the high-cost loan limits for conforming mortgages in high-cost areas. The baseline loan limits for both conforming and FHA loans in 2014 ... [1 chart]

$835 Million Ginnie Mae Servicing Portfolio Hits Market. Mountain Servicing Group (MSG), a residential mortgage servicing rights transaction and valuation advisor, has announced an $835 million Ginnie Mae bulk-servicing offering. The company is the exclusive advisor to the seller, described only as “one of the premier mortgage bankers in the country.” The portfolio includes 99.7 percent fixed-rate and 100 percent first-lien, government-backed loans, with a weighted average original FICO of 691. Its weighted origination loan-to-value ratio is 94 percent, and its weighted average interest rate is 4.0 percent. The average loan size is $205,309. Top states for the portfolio are California (23.9 percent), New York (9.6 percent), Florida (4.7 percent), and Pennsylvania (4.5 percent). “It’s an exceptionally clean GNMA portfolio, with very low coupon and low delinquencies,” said Robert Wellerstein, managing director at MSG. “We expect this package to ...

The volume of mortgages subserviced for others declined slightly in the second quarter, but still face bright prospects as many firms contemplate outsourcing the processing chore to specialists that can effectively handle an increasing array of compliance regulations. The nation’s three largest subservicers – Dovenmuehle, Cenlar and PHH Mortgage – had a combined subservicing market share of 55.8 percent at June 30, dominating the sector, according to exclusive survey figures compiled by Inside Mortgage Finance. On a sequential basis, Dovenmuehle grew...[Includes one data chart]

Capital standards for nonbank mortgage firms is inevitable. But what should the requirement be?

“If g-fee increases were being used to build up enterprise reserves, instead of being swept under the Treasury agreement, we would be more open to such increases,” said the CHLA.

it appears the halcyon days of legacy MSR sales are over. Or so Ocwen is telling Wall Street.

The Federal Housing Finance Agency should abandon its proposed increase in guaranty fees charged by Fannie Mae and Freddie Mac, according to a number of industry groups. The Mortgage Bankers Association said in a comment letter that it opposes hikes in g-fees and loan-level price adjustments, noting that g-fees have become attractive to Congress as cash cow means for funding non-housing programs. “Clearly, the GSEs were undercapitalized...

Concern about government-proposed capital rules for private mortgage insurers and their potentially negative effect on MI premiums has prompted loan guarantors and others to call for changes. The Mortgage Bankers Association, National Association of Realtors and several private MI companies have urged the Federal Housing Finance Agency to ease proposed capital requirements for private MIs. As written, the proposed rules could cause MI premiums to spike, making it more difficult for first-time homebuyers to purchase a home and for MIs to maintain market share, they warned. The draft Private Mortgage Insurer Eligibility Requirements (PMIERs) is...