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Inside Mortgage Finance

March 2, 2017

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2016 Was a Big Year for Purchase-Mortgage Lending, But the Refinance Market Was Booming as Well

Purchase-mortgage originations in 2016 hit their highest level since before the housing market crash, including a solid uptick in first-time buyer activity, according to a new Inside Mortgage Finance ranking and analysis. Revised estimates show a total of $1.021 trillion of home-purchase mortgages were originated in 2016, a 10.5 percent increase from the previous year. It marked the biggest volume of purchase-money lending since 2006 even though the purchase share of new originations declined. That’s...[Includes five data tables] Read More

Mortgage M&A Continues to Hum Along; Caliber Pounces While Others Scour For Opportunities

Caliber Home Loans, Dallas, this week agreed to buy most of Banc of California’s mortgage operations, the nonbank’s second acquisition of the past seven months, and a possible harbinger of more activity to come. Mortgage M&A consultant Chuck Klein of Mortgage Banking Solutions said his advisory firm is now involved in at least six different deals. Rick Roque of Menlo Financial predicted that by the time this deal-cycle plays out, 20 percent of nonbanks could disappear via a purchase of one sort or another. Klein recently attended... Read More

Mortgage Servicing Compensation Is an Issue That Won’t Die; Now Treasury May Weigh In

With servicing costs climbing the past five years, the issue of how much to pay residential loan processers is once again rearing its ugly head. And depending on who you talk to, the Treasury Department may take up the issue as well, especially since it controls the senior preferred stock of Fannie Mae and Freddie Mac. One industry advisor involved in the topic, speaking under the condition his name not be used, told... Read More

Congress Focusing More on GSE Reform; Credit-Risk Transfer Deals Seen as a Model and Potential Deterrent

Calls from offices of members of Congress seeking information regarding reform options for the government-sponsored enterprises have increased recently, according to Andrew Davidson, president of Andrew Davidson & Co., an analytics firm. Speaking this week at the SFIG Vegas conference produced by Information Management Network and the Structured Finance Industry Group, Davidson said he has received “a surprising number of calls” from congressional staff regarding GSE reform. Fannie Mae and Freddie Mac have been... Read More

Industry Participants Push to Include Servicing Reforms in Broader Housing Reform Efforts

As policymakers work toward housing finance reform, industry participants are forming plans to ensure that servicing issues are addressed. The Urban Institute’s Housing Finance Policy Center recently launched the Mortgage Servicing Collaborative, which will provide data on servicing issues and analyze possible solutions. “We are... Read More

Defective and Fraudulent Mortgage Applications Rise as Less Risky Refinance Loans Dwindle

More defects and fraudulent information were found in mortgage applications in December and January, according to the First American Loan Application Defect Index. Analysts blame the increase on the dwindling share of less risky refinance transactions. January numbers show that the frequency of defects, fraudulence and misrepresentation in the information submitted in mortgage loan applications increased 5.8 percent in January compared with December. “This month, the Loan Application Defect Index continued... Read More

Trump Orders Government Agencies to Set Up Regulatory Reform Task Forces to Cut Red Tape

President Trump last week signed an executive order requiring every agency to establish a regulatory reform task force to eliminate red tape. Under the EO, each task force will evaluate existing regulations and identify candidates for repeal or modification. Also, it will focus on eliminating costly and unnecessary regulations. Further, in order to hold the task forces accountable, the agencies will measure and report progress in achieving the president’s directives, according to the White House. It’s... Read More

Contracts Signed on Existing Homes Fall in January, Signals a Competitive Spring Housing Market

Although sales of existing and newly constructed homes were both up in January 2017, a slump in the number of contracts signed for existing homes may be a harbinger of a rough spring market. A low supply of homes on the market, especially in the Midwest and West, caused a lull in pending home sales at the beginning of the year, according to a National Association of Realtor index based on contract signings. The Pending Home Sales Index showed that the number of homes with a contract in January was the lowest it’s been since January 2016. Existing home sale gains (up 3.3 percent in January) showed... Read More

House Budget Vote Suggests GOP to Keep Reform Of Dodd-Frank, CFPB, GSEs on Its Front Burner

The House Financial Services Committee, as part of the congressional budget process, this week voted on its budget views and estimates for fiscal year 2018, with an eye on changing the Dodd-Frank Act, the Consumer Financial Protection Bureau, and Fannie Mae and Freddie Mac. The committee’s report is intended as guidance for the House Budget Committee as it crafts its FY2018 budget legislation but is not binding. In reference to Dodd-Frank, the HFSC Republicans’ budget document stated... Read More

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