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Inside Mortgage Trends

March 23, 2012

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Mortgage Industry Made Little Progress On Buyback Headaches During 2011

Mortgage lenders, private mortgage insurers and the government-sponsored enterprises remained at loggerheads on the nagging problem of loan buybacks and MI cancellations as 2011 came to a close. Despite several “global” settlements by the GSEs and halting progress on legal wrangling over representation and warranty claims related to non-agency mortgage-backed securities, a new Inside Mortgage Trends analysis reveals there were more unresolved buyback demands at the end of 2011 than there were at the beginning of the year. A clear sign of the persistent seriousness of...(Includes two data charts) Read More

HARP: Losing Steam or Revving Up?

The expanded Home Affordable Refinance Program barely got off the launch pad in December, but more recent data and anecdotal reports suggest that the revamped mission to help underwater Fannie and Freddie borrowers is flying higher in early 2012. Even as the government-sponsored enterprises were reporting a 5.0 percent increase in refinance activity in December, the number of new HARP loans declined by a whopping 35.8 percent from the previous month. HARP activity increased by 3.3 percent from the third to the fourth quarter of last year, but that was significantly...(Includes two data charts) Read More

Servicers Fear Hidden Costs in Settlements

The recent Servicing Resolution Agreements signed by the nation’s top five mortgage servicers with the federal government and state attorneys general may have been clear on the cost of their key provisions but it is the enormous hidden costs of compliance that could bite the financial institutions in the long run, according to compliance experts. Following the recent announcement of the national servicing settlement, it is impossible to put an accurate dollar amount on the myriad things servicers need to do in order to comply, but experts agree that staffing, training, technological upgrades... Read More

Nationstar Sees Opportunities in MSRs, Solutions

Nationstar Mortgage Holdings says the deal it announced earlier this month to purchase $63 billion of mortgage servicing rights from Aurora Bank FSB, a subsidiary of Lehman Brothers Bancorp Inc., is part of the servicer’s long-term strategy to drive future growth. Texas-based Nationstar, the home finance unit of Fortress Investment Group, said the purchase represents all of Aurora’s servicing with 75 percent of the loans in non-agency mortgages, comprising approximately $45 billion of Aurora-serviced non-agency loans. Aurora serviced $34 billion of Alt A and negative amortization loans and about $10... Read More

ResCap Facing Downgrade, Bankruptcy, Sale

Ally Financial may be getting closer to ridding itself of its non-agency mortgage unit, ResCap, the residual of a business formerly known as Residential Capital that helped invent the jumbo securitization and Alt A markets. According to reports, Ally is weighing putting ResCap into bankruptcy as a prelude to selling the business to Fortress Investment Group or another suitor. Ally’s primary mortgage business, GMAC Mortgage, is a top seller-servicer in the agency market. ResCap and GMAC Mortgage are separate entities that are both subsidiaries of the holding company that also owns Ally... Read More

Fed Details Growth in Mobile Banking Tech

Mobile devices have increasingly become tools that consumers use for banking, payments, budgeting and shopping, according to a new Federal Reserve report that offers useful business intelligence for mortgage lenders and technology vendors. The ubiquity of mobile phones is changing the way consumers access financial services, the Fed found. Twenty-one percent of mobile phone owners have used mobile banking in the past 12 months, and 11 percent of those not currently using mobile banking think that they will probably use it within the next 12 months. The most common use of mobile banking is to check account... Read More

Will AG Settlement Spur Deficiency Waivers?

Buried in the fine print of the $25 billion nationwide servicing settlement is a small incentive for the five banks if they agree to waive their right to seek deficiency judgments against distressed borrowers. The five servicers agreed to make some $17 billion in loan modifications and refinances, but they meet those obligations by racking up “credits” for a long list of actions. For every dollar of principal reduction made on a portfolio mortgage with a loan-to-value ratio under 175 percent, for example, they get a dollar of credit toward their obligation. The agreement gives them credit for... Read More

Mortgage Trends

The residential shadow inventory has remained steady at 1.6 million units in January, CoreLogic said in a new report with numbers through January 2012. The firm notes that the flow of distressed sales out of the shadow inventory has been relatively even with the flow of new seriously delinquent loans into the inventory. The 1.6 million units are equal to a six-month supply, which is a year-over-year improvement from January 2011, when the 1.8 million units represented an eight-month supply. Of the units currently in shadow inventory, 800,000 are seriously delinquent, 410,000 are already in the foreclosure... Read More

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