Economists note that the pricing of mortgage credit risk depends not only on the quality of the underlying mortgages but also on who ultimately bears that risk.
The FHFA director told homebuilders that Fannie Mae and Freddie Mac probably won’t play a big role in construction finance, but the Federal Home Loan Banks may expand their participation in the sector.
The Broker Action Coalition says that if the borrower pays for a credit report, they should own it, a concept it believes could significantly reduce closing costs.
Fannie and Freddie report that they’ve received UAD 3.6 submissions on all property types. Likewise, Fannie said top aggregators are accepting UAD 3.6 appraisal reports and appraisal management companies support it.
More than two-thirds of the largest GSE sellers saw a sequential decline in deliveries in May, with refi business slowing. But overall volume for the first five months of the year was up 35.7%. (Includes two data tables.)
A 50% cap on debt-to-income ratio within Fannie Mae’s Desktop Underwriter acts as an extra-regulatory limit on credit availability, according to researchers at the Federal Reserve Bank of St. Louis.
Implementation of UAD 3.6 has proceeded steadily during broad production, with mandatory implementation still set for Nov. 2. UAD 2.6 appraisals submitted on or after that date will fail, even if the appraisal was conducted prior to the mandate.
Changes at Freddie Mac simplify income history verification for both self-employed and non-self-employed borrowers. That includes certain borrowers who receive guaranteed payments from a partnership.
Lenders responsible for the majority of conventional mortgage originations are currently using VantageScore in some fashion, but it’s still not clear how they deal with differences between VS4 and classic FICO.
A GSE shareholder advocate says selling rights to existing shareholders could resolve conflicting objectives that have vexed GSE reform during the Trump administration.