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Inside Mortgage Finance

September 29, 2006

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109th Congress Winds Down Regular Season; Elections May Determine Mortgage Issues in Lame Duck

Two major legislative projects for the mortgage industry are hanging in the balance as Congress wraps up its regular session this week before heading off to a fiercely contested midterm election that could produce a dramatic shift in the balance of political power.During the 109th Congress, the House managed to finish a major bill to reform the government’s oversight of Fannie Mae, Freddie Mac and the Federal Home Loan Banks, as well as a bill to imple-ment major reforms to the... Read More

Despite Reports, Predatory Lending Bill Not Coming Soon as Consensus on Key Issues Remains Elusive

Those waiting for new federal legislation aimed at curbing predatory lending can come back from the edge of their seats: rumors that a new compromise proposal would be introduced this week appear unfounded. Reports that a new predatory lending proposal would be offered soon began to swirl last week after Rep. Spencer Bachus, R-AL, chairman of the House Financial Services Subcommittee on Housing and Community Opportunity, told reporters after a recent conference that his staff was putting the... Read More

Home-Equity Lending Continues Booming in 2006, With Strongest Growth Coming in Closed-End Junior Liens

Mortgage lenders continued to find an expanding market in second lien, home-equity loans during the second quarter of 2006, according to a new Inside Mortgage Finance analysis. An estimated $110.0 billion of home-equity loans were originated during the second quarter, up 7.8 percent from the first three months of the year. That brought year-to-date production of home-equity loans to $212.0 billion, a 12.8 percent increase from the same period in 2005... Read More

Countrywide Leads Refinance Market That Continues to Defy Expectations in 2006

Refinance activity is supposed to wax and wane like the phases of the moon as interest rates rise and fall through time, but 2006 is proving that there is now a substantial built-in demand for home loan refinancing. An estimated $724.0 billion of refinance mortgages were originated during the first half of 2006, or 48.1 percent of total production. While not much of that business is tied to traditional rate/term refi activity, consumer demand for cash-out transactions remains strong...[Includes 1 full page of charts] Read More

GSE Effort to Translate Loan Docs to Spanish a ‘Positive Step,’ But Latino Advocates Want Translations Expanded, Simplified

Hispanic civil rights and community advocates lauded efforts by Fannie Mae and Freddie Mac to provide non-binding mortgage documents in Spanish to help guide non-English speaking borrowers through the home loan process. The two government-sponsored enterprises jointly announced this week the availability of 83 translations of uniform instruments, to help Latino borrowers understand the conditions and terms, and other key disclosures, of the loans they are trying to obtain. Hispanic community advocates welcomed... Read More

Income Verifications Expected to Come More Quickly After IRS Upgrades System

The Internal Revenue Service is upgrading its income verification program, a change that will allow lenders to process loan applications quicker. Starting in October, the IRS will deliver borrower tax returns to lenders electronically. Currently, transcripts are paper and either mailed to or picked up by the requestor with a turnaround time of one to two days. The upgrade will reduce that processing time, but will not provide real-time verification... Read More

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