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Inside Nonconforming Markets

May 5, 2006

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MIs Attack Piggyback Loans in Nontrad Comment

Are piggyback second mortgages harmful products for a great many borrowers? Mortgage insurers seem to think so. “Simultaneous seconds are among the most troubling of the products in the emerging nontraditional mortgage product spectrum,” said the Mortgage Insurance Companies of America in a comment letter submitted to federal bank and thrift regulators in response to proposed guidance on nontraditional mortgages. … Read More

Freddie Pulls Ahead in IO Loan Purchases

When it comes to purchasing prime interest-only loans, Freddie Mac clearly has a healthier appetite than rival Fannie Mae, according to a new analysis and ranking based on the Inside Mortgage Finance MBS Database. All together, lenders sold $40.86 billion in new IO loans to the two government-sponsored enterprises during the first three months of the year. Putting that figure into perspective, the two GSEs combined purchased just $86.21 billion in prime IO loans in… [One data table included] Read More

Concern Grows About Consumer Alt Loan Savvy

Option ARMs have become an established part of the mortgage market landscape. But do customers really understand the risks – and the potential tradeoffs – they are taking on when they opt for these complex loans? Borrower savvy about the workings of nontraditional mortgages, particularly option ARMs, which allow customers to choose each month among minimum, interest-only, and fully-amortizing payments, has been a major topic of discussion at industry gatherings in recent months. In general,… Read More

Subprime Heavyweight Pares Down for Alt A Push

One of the subprime market’s largest players, Ameriquest Mortgage, is retooling its retail origination platform as part of a cost-saving push that it says will help it expand into new market segments – including the Alt A space. Last week, Ameriquest abruptly laid off close to 4,000 loan officers and processors while shuttering more than 200 retail branches. Going forward, the privately-held California-based firm, which has built one of the most recognizable brands in… Read More

Canadian Firm Touts 50-Year Amortization Loan

A Canadian-based mortgage company has pushed the envelope when it comes to amortization, launching a new 50-year program. But don’t expect the product to stay north of the border: Reliant Home Warranty Corp. is gearing up for a push into the U.S. “This innovative action by Reliant will give mortgage customers the ability to make the most use of their hard-earned income and make housing more affordable to the consumer,” said Boyd Sousanna, Reliant… Read More

ITIN Lending Provides Opportunities, Legal Risks

Undocumented immigrants are one of the hottest new emerging markets for mortgage lenders, which are expanding their reach with new programs aimed at capturing growing demand for homes among a swelling Latino population. But the market could get cut off before it really gets going, thanks to efforts by some state lawmakers to crack down on illegal immigrants. … Read More

Reverse Mortgage Lenders See Growth Potential

If someone asked you to list the hottest mortgage products, you would probably include option ARMs along with IO loans and various flavors of low- and alternative documentation products. But your list would be incomplete if it didn’t include reverse mortgages – a product that lenders say could see significant new demand in the months ahead as an aging population seeks to downsize its homes and tap years of accumulated equity. … Read More

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As homeowner equity continues to build, more and more lenders are launching home equity lending products. Are you thinking of joining this market?

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