Fannie Mae, Freddie Mac and Ginnie Mae produced a combined $88.96 billion of single-family MBS in January, a modest 1.4 percent decline from December, according to a new ranking and analysis by Inside MBS & ABS. Ginnie production was actually up 7.2 percent from the previous month, while both the government-sponsored enterprises posted declines in new issuance. January’s agency MBS production included...[Includes two data tables]

Different factions of the mortgage industry are strongly urging the Consumer Financial Protection Bureau to place its yearend “clarifying letter” on TRID errors into the Federal Register, believing that it would provide stronger legal protection. According to interviews conducted by Inside Mortgage Finance, TRID errors – even minor ones – continue to be a chief reason why certain secondary market investors are rejecting mortgages, in particular non-agency product. The fear for these investors is assignee liability, that they could be sued for TRID errors even though they had nothing to do with the loan’s origination. One paragraph in the Dec. 29 letter from the CFPB to the Mortgage Bankers Association begins...

With nonbanks fearing they could be stuck with error-laden mortgages that violate the integrated disclosure rule, a secondary market has developed for this new breed of “scratch and dent” loans, according to interviews conducted by Inside Mortgage Finance. One investor, requesting his firm’s name not be identified, said his shop bought such a mortgage for 90 cents on the dollar. Participants in the market – including investors and traders – concede...

Existing home sales increased by 14.7 percent in December compared with the previous month, according to data from the National Association of Realtors, suggesting that issues involving the Consumer Financial Protection Bureau’s disclosure rule were temporary. NAR said 5.46 million sales of existing homes were completed in December, on a seasonally adjusted basis, up from 4.76 million the previous month, marking the largest monthly increase ever recorded by the group, on a percentage basis. Existing home sales in November were down by 10.5 percent from the previous month as lenders grappled with the new TRID disclosure rule. “While the carryover of November’s delayed transactions into December contributed greatly to the sharp increase, the overall pace taken together indicates...

Although the CFPB recently issued a “clarifying” letter on errors tied to the TRID integrated disclosure rule, deep concerns remain among originators that fund non-agency product for sale into the secondary market. Moreover, according to interviews conducted by Inside Mortgage Finance, an affiliated publication, some nonbank lenders are seeing noticeable increases in origination costs because loans are taking longer to close and therefore remain on warehouse lines for an extended period of time. Because nonbanks fund almost all of their production using warehouse credit, the implication boils down to this: already squeezed profit margins are going to shrink. Industry efforts to comply with the new disclosures, which merge requirements of the Truth in Lending Act and the Real Estate Settlement ...

The recent letter from CFPB Director Richard Cordray to the Mortgage Bankers Association clarifying certain aspects of the bureau’s integrated disclosure rule has some important take-aways – and certain limitations – the industry should be mindful of, according to some top industry attorneys. In a recent online blog posting, attorneys Donald Lampe and Leonard Chanin of Morrison & Foerster LLP identified a handful of key take-aways for mortgage market participants related to the TRID rule. First, “If mortgage loan originators and others involved in the origination, financing and sales of mortgage loans are not familiar with the benefits of [specific] Know Before You Owe disclosure cure provisions, now is the time to assess them,” the attorneys began. They then noted that Cordray’s ...

The latest installment of the Campbell Surveys/Inside MortgageFinance HousingPulse Survey of real estate agents again found widespread, but generally minor, disruptions to mortgage closings throughout the United States due to the CFPB’s integrated disclosure rule known as TRID. TRID did affect December closings, manifesting as the second month of slight increases in closing times and in the percent of missed closings. “Most housing market metrics continue to be strong, despite the onset of TRID and the entry into the winter season,” said the report, which is sponsored by Inside Mortgage Finance, an affiliated newsletter. Further, “Closing times metrics are still showing a minor effect of TRID, and the predicted significant impact in December did not materialize.” The report also provided ...

Investors in non-agency U.S. residential mortgage-backed securities are unlikely to face much in the way of risk stemming from lender non-compliance with the new requirements of the CFPB’s integrated disclosure rule known as TRID, according to analysts at Fitch Ratings. “Although the frequency of non-compliance issues will likely be elevated initially as lenders implement the new changes, those non-compliance issues are not likely to translate into higher risk for bondholders,” the analysts said in a recent report. Their initial due diligence sampling of prime jumbo mortgages in the secondary market has revealed a high level of compliance issues thus far. However, most of them appear to be good-faith errors. The ratings service is continuing its discussions with market participants on ...

Here are the Top 10 TRID Deficiencies, According to One Lender. The folks at Stearns Correspondent Lending recently published a list of the top 10 compliance deficiencies associated with the CFPB’s integrated disclosure rule, as follows: 1.The Closing Disclosure was not provided to the borrower within three business days of the closing date. 2. Various unspecified issues with the Loan Estimate.3. The Loan Estimate was not disclosed to the borrower within three business days of the application date. 4. Borrower(s) did not receive the Loan Estimate within four business days of the closing date. 5. The lender failed to provide a valid change of circumstance for all subsequent Loan Estimates in the file. 6. The lender failed to ...

There’s mounting evidence that the Consumer Financial Protection Bureau’s disclosure rule is having an impact on home sales and purchase mortgages, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. In December, closing times on mortgage-financed home purchases continued to stretch out and fewer sales closed on time. Tom Popik, research director of Campbell Surveys, said the CFPB’s Truth in Lending/Real Estate Settlement Procedures Act disclosure rule appears to have caused slight increases in closing times and the share of missed closings for the second month in a row. “Closing time metrics are still showing...