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Inside Mortgage Finance

May 21, 2015

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Refi Surge in Conventional-Conforming Market Helped Fuel Originations Uptick in Early 2015

The conventional-conforming sector led the mortgage market’s surge in production volume during the first quarter of 2015, according to a new Inside Mortgage Finance ranking and analysis. Lenders originated an estimated $207 billion of conventional-conforming mortgages during the first three months of this year, an 18.3 percent increase from the fourth quarter of 2014. The conventional-conforming sector accounted for 57.5 percent of the $360 billion in overall mortgage originations during the period. The $360 billion is a revision of our initial estimate and does not include home-equity lending. The government and jumbo markets were...[Includes two data tables] Read More

Analysts See Stronger Market in 2015, But Little Change In Fundamental Problems Facing the Mortgage Industry

Housing is showing some traction, but heavy regulation and enforcement continue to weigh on the mortgage market, according to analysts at this week’s secondary-market conference sponsored by the Mortgage Bankers Association in New York. Charles Gabriel, president of Capital Alpha Advisors, said there are some green shoots in the mortgage market, including signs of more home sales. But he characterized it as “a mature market that is suboptimized.” Lenders have paid massive penalties in lawsuits, he added, and there is no sign that they will expand the credit box. “U.S. Bank was asked... Read More

Nonbank Gains in Market Share Boost Warehouse Lending; a Strong Refinance Market Helps Too

Warehouse banks increased their commitment levels to $40 billion at the end of the first quarter, a 14.3 percent sequential gain and a sign that all is well in residential originations, at least for now. Not only did warehouse providers benefit from stronger originations in early 2015, their business was boosted by the fact that nonbanks continue to gain origination market share. Compared to the same quarter a year ago, commitments are up a mouth-watering 42.9 percent, according to exclusive survey figures compiled by Inside Mortgage Finance. Then again, at $360 billion, the first quarter of 2015 was...[Includes one data table] Read More

Dems’ Alternate Reg Relief Bill Would Confer QM Status on Portfolio Loans Only for Small Lenders

The noise over regulatory relief legislation is getting louder. Over the past week, Republicans in the Senate issued a clarification of sorts about their draft legislation, Democrats came up with a narrower alternative and the industry weighed in as the Senate Banking, Housing and Urban Affairs Committee prepared for a markup scheduled for late this week. A noteworthy provision in the Democrats’ proposal would extend qualified-mortgage status for loans originated and held in portfolio – but only if the depository institution has less than $10 billion in assets. The GOP bill would extend this safe harbor to all banks, thrifts and credit unions. The Democratic proposal would bar... Read More

Lenders Prevail in Novel Lawsuits Involving Loss Mitigation, Allegations of Predatory Lending

Separate lawsuits against major banks were dismissed last week, providing some insight on how lenders and servicers can defend against claims brought by consumer advocates under the False Claims Act and allegations of redlining and reverse redlining. In 2013, Advocates for Basic Legal Equality alleged that U.S. Bank’s servicing practices violated the FCA. U.S. District Court Judge Jack Zouhary dismissed the lawsuit, noting that the claims were barred by the “public disclosure doctrine.” Larry Platt, a partner at the law firm of K&L Gates, said... Read More

First-Time Homebuyer Share Up Sharply This Spring, Helped By Reduction in FHA Insurance Premiums

The first-time homebuyer share of home purchases in April hit its highest level in more than four years, according to the Campbell/Inside Mortgage Finance’s HousingPulse Tracking Survey. The purchases have been boosted by a reduction in the FHA’s mortgage insurance premiums and help rebut concerns about the demise of the first-time homebuyer. First-time homebuyers accounted for 37.6 percent of home purchases in April, up from a 34.3 percent share a year ago, based on three-month moving averages. The last time the first-time homebuyer share of home purchases was above 37.6 percent was in August 2010 at a 40.0 percent share. Tom Popik, research director of Campbell Surveys, said... Read More

Class Certification Denied in Bank’s Fair-Lending Suit; Groups Sue Fannie for Bad REO Practices

In a ruling that may impact future fair-lending class actions, a federal district court judge in Manhattan has denied class certification in a lawsuit brought by the American Civil Liberties Union and National Consumer Law Center against global investment bank Morgan Stanley. Filed in October 2012, the suit was brought on behalf of African American borrowers in Detroit who obtained subprime loans from New Century Mortgage, a now-defunct originator that sold the loans to secondary-market purchasers, including Morgan Stanley, which then securitized them. New Century originated... Read More

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