The Department of Veterans Affairs has issued guidance to mortgage servicers regarding the process of sending loss mitigation letters to borrowers who have fallen behind on their monthly payments. The guidance encourages servicers to work with distressed borrowers to avoid foreclosure.

The volume of broker-originated FHA and VA refinance loans pooled in new Ginnie MBS jumped 94.1% from the first to the second quarter. Correspondent production saw the smallest gains among the three channels.

Fueled by low rates, demand for FHA and VA refis was strong in the second quarter, although purchase loan originations for both programs hit the ceiling as well.

President Trump has signed into law the VA “orphan” bill to remove conflicting requirements that caused many VA refis to remain ineligible for delivery into Ginnie Mae pools.

VA has directed lenders not to advise veterans to close a loan without first verifying their exemption from paying the VA funding fee.

Congress withdrew a provision in the Blue Water Navy Vietnam Veterans Act that would have raised the guarantee fee on VA home loans. Instead, it approved the removal of the cap on VA mortgages.

Correspondent production remained the biggest source of FHA and VA loans, but the rapid growth at United Wholesale Mortgage is reshaping channel dynamics.