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Inside Mortgage Trends

October 26, 2018

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MSR Secondary Market Heated Up in 3Q18 with Closing of Nonbank Sale

Transfers of agency mortgage servicing rights jumped significantly in the third quarter thanks largely to Citizens Bank’s acquisition of Franklin American Mortgage, according to a new Inside Mortgage Trends analysis. A total of $179.13 billion of MSR tied to Fannie Mae, Freddie Mac and Ginnie Mae mortgage-backed securities changed ownership during the third quarter, a hefty 38.3 percent jump from the prior period. Most of the activity was in bulk servicing ... [Includes three data charts] Read More

Big Banks Post Mixed Results in 3Q18 Originations

The nation’s major banks had a challenging third quarter as residential production declined at most of the larger shops while nimble-footed nonbanks outperformed, according to a new analysis by Inside Mortgage Trends. Wells Fargo, the nation’s largest home lender and a bellwether for the industry, originated $45.2 billion in residential first liens during the third quarter, a 7.1 percent sequential decline. Its closest competitor, JPMorgan Chase, fared a bit better, funding $24.6 billion of ... Read More

Ginnie Mae Watching Nonbanks Closely

If anyone in the mortgage industry thought Ginnie Mae – and FHA for that matter – might take a kinder, gentler approach to the lenders it manages under the Trump administration, by now they are sorely disappointed. Over the past few weeks, Ginnie has suspended a mid-sized lender – 360 Mortgage Group – from its program and sent Executive Vice President Maren Kasper to the annual convention of the Mortgage Bankers Association to relay the message that agency stress tests are ... Read More

Digital ‘Footprint’ Useful for Predicting Defaults

Specific details in consumers’ email addresses and insight into whether lower-case writing is consistently used can be just as useful for predicting defaults as credit scores, according to research published by the Federal Deposit Insurance Corp. The findings suggest that financial technology companies could use data from so-called digital footprints to challenge traditional lending business models. The findings were detailed in a recent paper titled “On the Rise of the FinTechs – Credit ... Read More

Mortgage Trends Show DTI, LTV Ratios Rising

There’s been a significant increase in high debt-to-income lending, according to industry experts speaking on a panel highlighting trends in mortgage credit at the Mortgage Bankers Association conference in Washington, DC, last week. Stephen Mackey, executive vice president and chief risk officer at Mortgage Guaranty Insurance Corp., asked, “Are we setting up borrowers for success?” Home prices are soaring at twice the rate of income growth and both DTI and loan-to-value ratios ... Read More

Mortgage Banking Income Down for Banks

Publicly-traded commercial banks and thrifts saw a modest decline in mortgage income during the third quarter, according to a new Inside Mortgage Trends analysis of earnings reports. A diverse group of 23 banks reported a combined $1.926 billion in mortgage banking income for the third quarter, down 1.8 percent from the previous period. Their combined year-to-date profits totaled $6.132 billion, off 13.6 percent from the first nine months of 2017. All but one ... [Includes one data chart] Read More

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