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Inside Mortgage Finance

November 17, 2016

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Government-Insured Lending Soared In 3Q16 While Jumbo Market Eased Up

Most of the lift in third-quarter mortgage originations came from the tail end of the refinance boom, especially in the agency market, according to a new Inside Mortgage Finance analysis. The government-insured market saw a hefty 21.4 percent jump in mortgage originations from the second to the third quarter as the sector reached an estimated $159.0 billion and accounted for 27.4 percent of total first-lien production. It was the second consecutive record quarter for FHA, VA and Department of Agriculture rural-housing production. The conventional-conforming segment was not far behind...[Includes two data tables] Read More

FHA’s FY 2016 Forward Portfolio Boosts MMIF’s Value, Capital Reserve Ratio but No Indication of Pricing Change

The FHA Mutual Mortgage Insurance Fund may be healthy enough to support a cut in forward-mortgage premiums, but officials at the Department of Housing and Urban Development aren’t yet willing to pull the trigger. HUD this week released its annual FHA audit showing strong improvement in the MMI Fund from the forward-mortgage side of the ledger. During a press briefing, Edward Golding, principal deputy assistant secretary for housing, said the strong audit results “do indicate there is room to return pricing to that which reflects the risks in the program.” He noted that the $245 billion in new FHA business in fiscal 2016 clearly added to the strength of the MMI Fund, “with indications we’re pricing above the risk of the program.” At the same time, Golding made... Read More

Mortgage Delinquencies Increase Slightly in Third Quarter As Part of Seasonal Trend; Uptick in FHA Delinquencies

Mortgage performance declined somewhat in the third quarter of 2016 compared with the previous quarter, according to the Inside Mortgage Finance Large Servicer Delinquency Index. The increase in delinquencies and foreclosures was part of a seasonal trend seen in recent years. The large servicers reported a total delinquency/foreclosure rate of 5.08 percent as of the end of the third quarter, up 8.6 basis points from the previous quarter. The increase was driven by new delinquencies across various buckets – largely concentrated among FHA mortgages – while the foreclosure rate decreased slightly. Every year since 2011, the total delinquency/foreclosure rate has increased... Read More

Trump Bond Market Correction Causes Rates to Spike. MSR Sales May Surge, But Some Wave the Caution Flag

Since the historic election of last week, interest rates have been steadily rising, turning the tables on what increasingly looked like a moribund market for servicing sales. But not anymore. Since the Nov. 8 election, the yield on the benchmark 10-year Treasury has spiked 50 basis points to 2.24 percent with mortgage rates following in the wake. And while this spells bad news for originators – especially refinance specialists – it’s manna from heaven for holders of mortgage servicing rights. As Inside Mortgage Finance went to press this week, market makers were... Read More

Experts Predict What Financial Regulations Under a Trump Regime Will Look Like

Inside-the-Beltway analysts are predicting that financial regulation and new agency leadership posts will be a primary battleground in the incoming Trump administration. The Bipartisan Policy Center said nominating and confirming people to fill seats on financial regulatory agencies, and at the Treasury, will likely be the most important moves made by the new president and Congress. President-elect Trump wants... Read More

Current Appraisal Regulations Outdated, Industry Needs Standardization, Modernization

Returning appraisal regulations back to the individual states would be counterproductive, according to James Park, executive director of the Appraisal Subcommittee of the Federal Financial Institutions Examination Council. Park and other experts spoke about the need for standardization and modernization at a hearing in the House Financial Services Committee this week. “Replacing the federal system with a state-based system would confuse, not streamline,” he said, noting that the “cornucopia” of statutes and guidelines are confusing and burdensome for everyone. Bill Garber, director of government and external relations at the Appraisal Institute, agreed... Read More

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