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Inside Mortgage Finance

October 4, 2018

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Refinance Market Continued to Slip in 3Q18, But Purchase Mortgages Lift Fannie/Freddie Business

Fannie Mae and Freddie Mac turned in a solid gain in single-family production during the third quarter of 2018, according to an exclusive ranking and analysis by Inside Mortgage Finance. The two government-sponsored enterprises issued $213.81 billion of new single-family mortgage-backed securities during the third quarter, a solid 10.4 percent increase from the previous three-month period. At $592.02 billion in production through the first nine months of ... [Includes three data charts] Read More

Need MSR Financing? Go See Freddie Mac – It Can Lend Up to $1 Billion and at a Deep Discount

As prospects wane in warehouse lending, some commercial banks are pondering a move into financing mortgage servicing rights but have a major concern: Freddie Mac, the government-controlled mortgage giant that’s in the midst of a $1 billion pilot program. During a recent Congressional oversight hearing, Federal Housing Finance Agency Director Mel Watt for the first time revealed the size of the MSR-financing pilot, saying it’s needed because nonbanks “do not have access to ... Read More

Private Mortgage Insurers Set to Comply with PMIERs Update, Analysts See Little Impact

Mortgage insurance companies reported they expect to be in compliance with updates to private MI eligibility requirements for doing business with Fannie Mae and Freddie Mac that were released late last week. The final version of PMIERs 2.0 will take effect on March 31, 2019, and analysts agree that other than a few tweaks, they aren’t terribly different than the original proposal. Since 2015, the U.S. Mortgage Insurers said, PMIERs have nearly doubled the amount of capital each mortgage insurer ... Read More

The M&A Roundup: Lots of Chatter, Mostly Smaller Deals with Some Larger Ones Far From a Sure Thing

When the going gets tough in the mortgage industry and profit margins begin to wither, thinly capitalized lenders start heading for the exits. But of late, the selling has been light, with a few large blockbuster deals – Ditech and loanDepot – remaining in the “maybe” column. “There’s a lot of chatter out there, but not much in the way of done-deals,” said Chuck Klein, managing partner of Mortgage Banking Solutions, Austin, TX. “But companies are concerned – they’re looking at the next 24 months and ... Read More

Mortgage Industry Waiting for Guidance on Implementation of Dodd-Frank Reforms

The industry is still waiting for guidance on how mortgage-related rules were changed by the Dodd-Frank regulatory relief bill, even though most provisions took effect immediately when the bill was signed into law in May. A number of requirements were changed in regard to smaller financial institutions by the Economic Growth, Regulatory Relief, and Consumer Protection Act, including the qualified-mortgage standard. However, the industry is still awaiting guidance from the Consumer Financial ... Read More

FHA Announces Second-Appraisal Requirement for HECMs, Reverse Mortgage Industry Backs Move to Cut MMIF Losses

Lenders expressed support for the FHA’s new interim policy requiring a second appraisal for home-equity conversion mortgages when the initial property valuation may be inflated. The new appraisal policy for HECMs took effect on Oct. 1 and will be in place through Sept. 1, 2019. FHA will review the policy to determine whether to renew it beyond fiscal year 2019, said FHA Commissioner Brian Montgomery during a press briefing this week. FHA will perform a collateral risk assessment of ... Read More

FHFA Director’s Harassment Allegations Center Stage at House Hearing, Accuser’s Lawyer Looks to Next Steps

With just three months left in Federal Housing Finance Agency Director Mel Watt’s term, it’s still uncertain whether he will ride out his appointment until January 6 as planned or resign because of sexual harassment allegations. Last week during a House Financial Services Committee hearing, lawmakers heard from both Watt and his accuser, Simone Grimes, about harassment that she said began in 2015. At the hearing, Watt fought back against the allegations and questioned the committee’s ... Read More

CFPB Appears to Favor Supervision Over Enforcement in Fair Lending as Controversy Swirls Around Key Official

Observers say the Consumer Financial Protection Bureau has changed its approach in fighting against lending discrimination under a new fair lending chief who has recently drawn heavy criticism for his controversial comments. “In the recent past, [the CFPB is] probably more supervision-oriented than enforcement action-oriented,” said Marshall Bell, a partner at Buckley Sandler, who advises companies on fair lending enforcement actions by the CFPB. “There has been a greater ... Read More

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