During his successful campaign for the White House, then-candidate Donald Trump won applause and support from the business community for his promise to substantially cut back on federal regulations. Many in the mortgage lending community had hopes the plan would include some relief from the mortgage regulations issued by the Consumer Financial Protection Bureau. Among other things, Trump said he would issue a temporary moratorium on “new agency regulations that are not compelled by Congress or public safety [and] cancel immediately all illegal and overreaching executive orders.” Richard Horn, who worked on the CFPB’s integrated-disclosure rulemaking known as TRID, said...

The DC Circuit Court of Appeals recently ordered PHH Corp. to respond to the Consumer Financial Protection Bureau’s petition for an en banc rehearing in the long-running dispute over alleged violations of the Real Estate Settlement Procedures Act. The lender’s response is due late this week. The court has also invited the U.S. solicitor general to weigh in on the constitutional and RESPA questions associated with the case. No timetable was suggested. However, industry legal observers expect the USSG to respond promptly, given the pending change of presidential administrations, and to support the bureau’s positions. Attorneys at the BuckleySandler law firm noted...

Shortly after being nominated by President-elect Donald Trump to be his Treasury secretary, investment banker Steve Mnuchin midweek dropped a bombshell on the mortgage market: Ending the conservatorships of Fannie Mae and Freddie Mac would be a top priority. For the most part, the mortgage industry cheered the news, believing that at the very least, Mnuchin would preserve the federal guaranty on existing MBS and into the future. In fact, the market seems to be betting on it. But now comes...

The average daily trading volume in agency MBS hit a yearly high of $224.4 billion in October, according to figures compiled by the Securities Industry and Financial Markets Association. With liquidity improving, the year-to-date average now stands at $206.6 billion, compared to $198.7 billion in 2015. The November reading should be out by the end of next week. Investors might be...

Analysts at Wells Fargo Securities worry that the post-election rate shock is not a positive omen for bank and overseas investors in MBS. “Since the U.S. presidential election, the 10-year yield has sold off by 55 basis points in a matter of two weeks,” they said in a recent client note. “Although banks and overseas investors are typically looking to buy on dips, large selloffs do not bode well for demand from these investors right after a rate shock. For banks, a large rate shock results in a hit on their regulatory capital.” According to their calculations, during the week ending Nov. 9, 2016, the net realized gains on bank portfolios declined...

Moody’s Investors Service published a warning this week regarding mortgage programs that use bank statements and letters from accountants to verify borrowers’ income. The rating service said that type of underwriting – especially when relying on fewer than 24 months of statements – yields loans that are more risky than mortgages that have traditional income verification. Bank-statement mortgages have gained some prominence in the non-agency market this year as Lone Star Funds ...

Lenders and servicers are likely to see some regulatory relief in the coming years though federal support for the housing market could also be reduced, according to officials at the Mortgage Bankers Association. The MBA’s Mortgage Action Alliance recently hosted a call with MBA officials providing projections for how the Trump administration and Republican control of Congress will impact the mortgage industry. “Things that were deemed impossible before the election are now in play,” said Meghan Sullivan, the MBA’s Senate Republican lobbyist. She said...

Steven Mnuchin, President-elect Donald Trump’s choice to be the next Treasury secretary, startled financial markets this week by indicating he would act quickly to bring Fannie Mae and Freddie Mac out of government conservatorship. “We’ve got to get Fannie and Freddie out of government ownership,” Mnuchin said during an interview with Fox News. “It makes no sense that these [two] are owned by the government and have been controlled by the government for as long as they have. In many cases, this displaces private lending in the mortgage markets, and we need these entities to be safe.” Mnuchin, a former Goldman Sachs executive who bought the failed IndyMac Bank and resurrected it as OneWest, continued...

Warehouse providers ended the third quarter with $58.0 billion of commitments on their books, a modest improvement over the prior period and a sign that nonbanks still hunger for residential credit. Compared to the same quarter a year ago, warehouse commitments increased an impressive 23.4 percent, according to survey figures compiled by Inside Mortgage Finance. That’s the good news. Now comes the bad: with interest rates rising since the election, warehouse managers are voicing their concern about what may lie ahead, namely lower originations. “Right now it feels...[Includes one data table]

The Federal Housing Finance Agency raised the maximum conforming loan limit for Fannie Mae and Freddie Mac mortgages in 2017 for the first time in a decade, but the impact on loan originations is questionable. Meanwhile, the FHA has not yet announced its 2017 loan limits. The baseline loan limit will go up for the first time since 2006, rising from $417,000 to $424,100. And the maximum high-cost loan limit for one-unit properties is climbing to $636,150, an increase of $10,650. The FHFA said that loan limits for the two government-sponsored enterprises will increase in all but 87 counties. An Inside Mortgage Finance analysis of Home Mortgage Disclosure Act data indicates...