Trends & Profitability

Browse articles from all of our Newsletters related to Trends & Profitability.

December 8, 2017 - Inside FHA/VA Lending

VA Originations Swing Back Up in 3Q17, Purchase Loans Fuel Surge

VA posted an 11.6 percent increase in originations in the third quarter, reversing a downward slide that began in early 2017. VA lenders ended the period with $45.5 billion in new originations, up from $40.8 billion in the previous quarter. The nine-month VA volume totaled $129.1 billion with purchase mortgages providing a strong boost. Streamlined refinancing, or Interest Rate Reduction Refinance Loans, accounted for 16.8 percent of VA loans originated and securitized during the nine-month period. The top five VA lenders in sequential order – USAA, Veterans United Home Loans, Quicken Loans, Navy Federal Credit Union and Freedom Mortgage – ended the third quarter with a combined $11.05 billion in originations and a 24.7 percent share of the market. Top-ranked USAA reported a 17.0 percent drop in VA lending in the third quarter from the previous quarter. Over the nine-month period, it racked up ... [charts]

December 8, 2017 - Inside FHA/VA Lending

Congress Passes Short-Term Spending Bill, Avoids Shutdown

Congress on Thursday passed a stopgap-spending bill to prevent a potential government shutdown and to give lawmakers time to negotiate crucial issues. The House voted 235-193 to pass the measure. A short time later, the Senate quickly approved it 81-14. The temporary spending bill will keep the government running through Dec. 22. The continuing resolution or CR, that has kept the government open would have expired on Dec. 8. Both the House and Senate are scheduled to adjourn on Dec. 15. Congress will need to pass a final appropriations bill or another continuing resolution to keep the government operating after Dec. 22. Despite differences over tax reform, FY 2018 budget, immigration, health care and other issues, lawmakers do not want a shutdown, mortgage industry sources said. Republicans, in particular, hope to enact their $1.5 trillion tax package by Christmas. On the other hand, ...

December 8, 2017 - Inside FHA/VA Lending

Ginnie Mae Expands Seasoning Requirement for VA Refi Loans

Ginnie Mae has issued expanded guidelines to protect veterans and investors from harmful loan churning and rapid prepayments in mortgage-backed securities. The changes, along with additional measures under consideration by a joint Ginnie Mae/VA refinance task force, are aimed at ensuring continued strength and liquidity of the Ginnie Mae MBS program, said Michael Bright, the agency’s acting president. The latest guidelines expand on an initial measure Ginnie implemented requiring six-months of seasoning of VA loans before they can be refinanced and delivered into Ginnie MBS pools. However, some lenders have found ways around the measure and have continued their questionable lending practices, said Bright during recent testimony before a House Financial Services subcommittee. Churning is both illegal and unethical because it preys on unsuspecting borrowers, who are pressured by ...

December 7, 2017 - IMFnews

Purchase Mortgages Continued to Dominate in 3Q17 but Refis Gained Ground

Agency MBS data indicate that first-time buyers have been key to this year’s surge in purchase-mortgage activity...

December 6, 2017 - IMFnews

HomeStreet Investors Criticize the Bank’s Mortgage Business

The investor was also critical of HomeStreet’s efforts to expand its footprint beyond the Pacific Northwest…

December 6, 2017 - IMFnews

Production, Servicing Profits Up in 3Q17

Servicing income rose 1.5 percent during the third quarter, although five of the 12 companies reported declines and one of them – PHH Mortgage – posted a loss.

December 6, 2017 - IMFnews

Senate Banking Committee Advances Reg Relief Bill With Substantial Mortgage Reform

Can it be? A bi-partisan reg relief measure that helps the mortgage industry?

December 5, 2017 - IMFnews

Mortgage Banking Earnings Declined for Depositories in 3Q17

Wells Fargo reported a huge drop in mortgage banking income, but the rest of the top five banks all posted increased earnings from their operations…

December 4, 2017 - IMFnews

New Amendment in GOP Tax Bill Spares Adverse Treatment for Mortgage Servicing Income

The MSR-saving amendment fixing the tax language was offered by Sen. Mike Rounds, R-SD...

December 1, 2017 - Inside Mortgage Trends

Report Shows Minority Homeownership in Trouble

The share of minority mortgage borrowers has shrunk over the last 10 years with the number of loans originated now nearly half of what it was at the peak of the lending boom, according to a recent report from The Urban Institute.

December 1, 2017 - Inside Mortgage Trends

Millennials Show Some Gains in Homeownership

The homeownership rate for Millennials is starting to climb, particularly for older borrowers in the generation, according to industry analysts.

December 1, 2017 - Inside Mortgage Trends

GSEs Report Progress on eMortgage Processes

Fannie Mae and Freddie Mac say they have made significant strides over the past year to address obstacles to the transition to a fully digital mortgage process that have been identified by mortgage lenders and other industry participants.

December 1, 2017 - Inside Mortgage Trends

Why Do Delinquencies Drop in April?

According to figures compiled for the National Mortgage Database and analyzed by Inside Mortgage Trends, for much of the past decade there has been a saw-tooth pattern that finds late payments begin increasing in November of each year before peaking in January.

December 1, 2017 - Inside Mortgage Trends

Production, Servicing Profits Up in 3Q17

Mortgage bankers saw modest gains on both sides of their business during the third quarter of 2017, according to an Inside Mortgage Trends analysis of earnings reports from a dozen publicly held companies.

December 1, 2017 - Inside Mortgage Trends

HomeStreet Investors Criticize Mortgage Business

Officials at HomeStreet Bank defended the bank’s mortgage business activities this week after facing criticism from one of the largest shareholders in the company.

December 1, 2017 - Inside Mortgage Trends

Mortgage Banking Earnings Declined For Banks and Thrifts in Third Quarter

The vast majority of commercial banks and savings institutions that do mortgage banking – either directly or through a subsidiary – generated a profit from the business during the third quarter, according to a new analysis by Inside Mortgage Trends of bank call reports.

December 1, 2017 - IMFnews

Conforming-Jumbo Market Grew Faster Than Non-Agency Sector in 3Q17

Roughly $119.1 billion of mortgages that exceed the conforming loan limit of $424,100 were produced during the third quarter of 2017…

December 1, 2017 - IMFnews

Bank Holdings of Non-Mortgage ABS Decline Again in 3Q17, Some Institutions Still Buying

Depositories held roughly 16.0 percent of outstanding ABS at the end of the third quarter…

November 30, 2017 - IMFnews

MBA: Origination Profits Declined in 3Q17

For lenders, the killer was rising expenses: $8,060 in 3Q17 compared to $7,774 in the second quarter…

November 30, 2017 - IMFnews

Guaranteed Rate National Sales Chief Jim Linnane Departs

Earlier this week, GR promoted two senior vice presidents – James Elliot and Chris Knapp – giving them additional responsibility over sales and recruiting…

November 28, 2017 - IMFnews

MBA Sounds Warning on GOP Tax Plan, Says MSR Values Will Get Hammered. ‘Financial Soundness’ Impacted As Well

Deal makers that buy and sell MSR assets said the Senate tax language could transform the mortgage business, creating leverage for aggregators...

November 28, 2017 - IMFnews

Mortgage M&A Activity Increases, but Major Deals are Elusive

Last year, Mortgage Banking Solutions brokered five deals. This year, the firm hopes to complete four and maybe five…

November 27, 2017 - IMFnews

‘Expanded Credit’ Originations Increase Ever so Slightly in 3Q17

Non-QMs account for the bulk of expanded-credit originations, with a 78.0 percent share…

November 22, 2017 - Inside FHA/VA Lending

Waters’ Proposal to Reinstate Life Of Loan Policy Would Weaken FHA

Congress and the FHA should avoid undertaking policy changes that would further weaken the agency’s ability to cover insurance losses and potentially lead to another taxpayer bailout, according to a recent analysis by The Heritage Foundation. THF analyst John Ligon and Norbert Michel, a research fellow, said FHA policy reforms should ensure that the agency maintains a limited role in the housing finance system. FHA should make way for private capital to enter the market and serve the housing needs of American households, they added. FHA can accomplish such policy goals by lowering its loan limits and adequately pricing insurance for borrower risk, the analysts said. In addition, Congress should ensure that FHA borrowers are required to maintain mortgage insurance over the full life of the loan as required currently by the Department of Housing and Urban Development, said ...

November 22, 2017 - Inside FHA/VA Lending

Ginnie Spots Inconsistent Reports Regarding First Payment Date

Ginnie Mae called on issuers to ensure that the data they submit are accurate following the discovery of erroneous payment reports. The agency said it has noticed discrepancies in the reporting of the first payment date on loan modifications in violation of Ginnie guidelines. Specifically, the first payment date some issuers reported as part of the loan-delivery data did not match the date submitted for the same mortgage loan as part of issuers’ monthly report of pool and loan data. Ginnie blamed the errors either on loans set up incorrectly for servicing or faulty data issuers had reported to the Department of Housing and Urban Development. Guidance issued by Ginnie on Nov. 14 reminded issuers to report the first scheduled payment date of the re-amortized loan when reporting the first payment date for modified mortgages through either the GinnieNET or the Reporting and Feedback System. The date ...

November 22, 2017 - Inside MBS & ABS

Walter’s Chapter 11 Reorganization Plan Not Likely To Affect Ditech-Serviced MBS, Say Fitch Analysts

Walter Investment Management Corp.’s planned Chapter 11 reorganization is not likely to affect the credit ratings of MBS backed by loans serviced by its subsidiary Ditech Financial, according to an analysis by Fitch Ratings.

November 22, 2017 - Inside FHA/VA Lending

VA Reports Slight Uptick in Use of Loan Benefit; 56% Still Non-Users

A newly released study by the Department of Veterans Affairs showed a 4.0 increase in the number of veterans who have used a VA mortgage in FY 2016 compared to the previous fiscal year. Also, a recent survey conducted by loanDepot found that 56 percent of veterans who participated did not take advantage of their VA loan benefits. Respondents included 400 targeted active servicemembers, veterans and surviving spouses. Conducted by the National Center for Veterans Analysis and Statics, the VA study focused on veterans who have used at least one of 22 benefits or services provided by the VA during fiscal years 2007 through 2016. The study found that loan guarantee was the third most used benefit by veterans behind health care and pensions. Of the 7.1 million vets who used at least one VA benefit, 2.6 million (36.6 percent) took advantage of the zero-downpayment, low-interest ...

November 22, 2017 - Inside FHA/VA Lending

Ex-FHA Chief Suggests Raising FHA Capital Ratio, Other Reforms

A former FHA commissioner has recommended raising the agency’s capital reserve ratio to 3 percent, to make FHA stronger and more resilient. Carol Galante, who served two years as FHA commissioner and assistant secretary for housing in the second term of the Obama administration, laid out her proposal along with other recommendations in a paper that she co-authored. Housing-finance reform without a retooled FHA could threaten families’ access to homeownership and increase risk to taxpayers, contrary to the goals of reform, said Galante, currently the faculty director of the Terner Center for Housing Innovation at University of California Berkeley. In her paper, Mission Critical: Retooling FHA to Meet America’s Housing Needs, Galante spelled out the changes necessary to help FHA perform its complementary and countercyclical role in the nation’s housing markets. Galante called for ...

November 22, 2017 - Inside FHA/VA Lending

Alert Out on Unwanted Refi Offers; CFPB, VA Warn of Misleading Ads

The Department of Veterans Affairs and the Consumer Financial Protection Bureau have issued a joint warning to servicemembers and veterans about VA refinancing offers that sound too good to be true. There is a good chance that borrowers with a VA loan have already received unsolicited offers to refinance their mortgages even just months after closing, the agencies said in their first “warning order” (WARNO). Many of these refi solicitations promise extremely low rates, thousands of dollars in cash back, skipped mortgage payments, no out-of-pocket costs and no waiting period, the agencies noted. The VA and the CFPB said lenders offering VA refinances may use aggressive and potentially misleading advertising and sales tactics. “Lenders may advertise a rate just to get you to respond or you may receive a VA mortgage refi offer that provides limited benefit to you while adding thousands of dollars to your loan balance,” the agencies warned. Even though the VA prohibits a lender from advertising skip payments on ...

November 22, 2017 - Inside FHA/VA Lending

Prospect of FHA MIP Reduction Fades as MMIF Cap Ratio Drops

Any chance of a mortgage-insurance premium reduction in the near future has dimmed in the wake of an actuarial report placing the FHA insurance fund on shakier ground at the end of FY 2017. One clear thing from the report released on Nov. 15 was that FHA’s flagship single-family home mortgage program continued to grow stronger with an economic net worth of $38.4 billion in fiscal 2017. In contrast, problems persisted in the Home Equity Conversion Mortgage portfolio, driving the program’s economic value down by another $6 billion to negative $14.5 billion. The drag HECM losses inflicted on the MMIF has renewed calls to separate the ailing portfolio from the fund, which can only be accomplished by legislation. Right now, the reverse mortgage issue is not even on Congress’ legislative agenda. HECM losses also caused the fund’s economic net worth and capital reserve ratio to decline in fiscal year ...

November 22, 2017 - Inside FHA/VA Lending

FHA Endorsements Rise in 3Q17, Nonbanks Remain Dominant

FHA single-family endorsements rose 2.0 percent in the third quarter from the prior quarter as more borrowers took out purchase loans and nonbanks remained in control of the market during the period. The FHA endorsed $62.1 billion of forward mortgages during the third quarter, which brought total production over the first nine months of 2017 to $182.7 billion (excluding reverse mortgages), a 2.5 percent decline from 2016. Fixed-rate loans continued to comprise nearly all of FHA’s business. Adjustable-rate endorsements totaled $935.3 million for the first nine months of 2017, up from $701.7 million a year ago. FHA purchase activity was up 4.4 percent to $48.5 billion in the third quarter while annual volume increased 2.6 percent from 2016. Purchase loans accounted for 73.6 percent of total FHA endorsements for the nine-month period. Of the $182.7 billion of FHA loans endorsed during the ... [Charts]

November 22, 2017 - IMFnews

Flagstar Rolls Out Zero-Down Product With Closing Cost Assistance

Qualified borrowers need not worry about repaying the closing-cost amount, Flagstar said...

November 22, 2017 - IMFnews

Publicly Traded Mortgage Firms Not Exactly Setting the World on Fire

Industry observers contend Ocwen, another money-losing company, would love to find a merger partner, but must first resolve its regulatory problems…

November 22, 2017 - IMFnews

3Q17 Results: Third-Party Lenders Gained Market Share in a Purchase-Heavy World

In the broker channel, United Wholesale Mortgage once again dominated…

November 21, 2017 - IMFnews

(A Ton) of Mortgage Executives on the Move?

Industry consultant Paul Hindman: “There seems to be a growing number of participants in this year’s game of musical chairs."

November 21, 2017 - IMFnews

Publicly Traded Nonbanks Post Earnings Gain for 3Q17 – Thanks to PennyMac

Excluding PennyMac, the eight remaining nonbanks had a combined $41.21 million net loss on mortgage banking activity…

November 20, 2017 - IMFnews

Mortgage Tech Vendors Make Case for Greater Digitalization

Tech vendors believe that home lenders are seeing dramatic benefits from automating their secondary marketing operations…

November 17, 2017 - Inside Mortgage Trends

OCC Pushes for Rebuilding in Distressed Areas

Recent guidance from the Office of the Comptroller of the Currency aims to allow banks to originate mortgages with high loan-to-value ratios to help borrowers in distressed areas complete home improvements. The OCC released guidance in August addressing originations of mortgages with LTV ratios above 90 percent, even allowing for LTV ratios above 100 percent in certain circumstances. Keith Noreika, the acting Comptroller of the Currency, discussed lending in ...

November 17, 2017 - Inside Mortgage Trends

First-Timers Constrained by Low Inventory

A lack of homes for sale is limiting the first-time homebuyer share of home purchases, according to the National Association of Realtors. NAR’s latest annual profile of homebuyers found 34 percent of respondents were first-time homebuyers, down from 35 percent in the 2016 report and the fourth lowest share for first-time homebuyers since 1981. The historical norm for first-time homebuyer share is 40 percent, according to NAR. Lawrence Yun, NAR’s chief economist, said a “severe drought” ...

November 17, 2017 - Inside Mortgage Trends

Homebuyers Monthly Mortgage Payments Up

Homebuyers’ “typical mortgage payment” has climbed about 10 percent in 2017 and may climb another 11 percent in 2018, according to a new analysis from CoreLogic. Company analysts attributed the payment change to rising mortgage rates over the past year. Typical mortgage payment (TMP) is a mortgage-rate-adjusted monthly payment based on each month’s median home-sale price. It is calculated using Freddie Mac’s average rate on a 30-year, fixed-rate mortgage with ...

November 17, 2017 - Inside Mortgage Trends

Tech Vendors Make Case for Greater Digitalization

As the mortgage industry continues evolving toward a 100 percent, end-to-end digital mortgage, automation and collaboration are playing essential roles, according to some top vendors. Bob Brandt, vice president of marketing and alliances at Optimal Blue, said, “The digital movement in the mortgage industry is all about automation – automation of the mortgage process truly from end to end: from lead generation to point of sale to processing and closing and the delivery of loans ...

November 17, 2017 - Inside Mortgage Trends

Mortgage Executives on the Move

Although mortgage companies are beginning to pare staff in anticipation of a seasonal production downturn, there appears to be a strong thirst for executive talent, as well as top managers looking elsewhere, according to interviews conducted over the past month by Inside Mortgage Trends. “Calls and e-mails from mortgage executives open to considering ‘a change’ usually spike at this time of year,” said Rick Glass, who runs the financial services recruitment firm that bears his name ...

November 17, 2017 - Inside Mortgage Trends

GSE Sellers Take Baby Steps on Risk

Mortgage lenders that sell single-family loans into Fannie Mae and Freddie Mac mortgage-backed securities continued to stretch the credit envelope during the third quarter, a new Inside Mortgage Trends analysis reveals. But the increase in the share of higher-risk lending is still going at a glacial pace, and low-risk mortgages continue to dominate the government-sponsored enterprises’ business. During the third quarter, mortgages in the lowest ... [Includes two data charts]

November 17, 2017 - Inside Mortgage Trends

As a Group, Publicly Traded Nonbanks Post Gain in Mortgage-Banking Income

Nine publicly traded mortgage companies posted a combined $52.22 million in mortgage banking earnings for the third quarter of 2017, according to a new analysis by Inside Mortgage Trends. The group’s third-quarter results represented a healthy 86.4 percent improvement over the paltry $28.02 million they earned from their core businesses during the April-June cycle. But the aggregate figures don’t begin to describe the state of most of these nonbank ... [Includes one data chart]

November 16, 2017 - Inside Mortgage Finance

Publicly Traded Mortgage Firms Not Exactly Setting The World on Fire. Is a Major Shake Up Coming?

Most of the nation’s six publicly traded mortgage firms have seen their share prices get smacked around this year. The exception is PennyMac Financial Services, a stand-out in a group that’s struggling to keep its head above water.

November 16, 2017 - IMFnews

Academy Mortgage Production EVP Departs

Nemec oversaw a retail network of 250 branches...

November 16, 2017 - IMFnews

Ginnie Mae President Candidate David Kittle Tells White House He Doesn’t Want the Job

Kittle was first approached by the White House nine months ago about the job.

November 16, 2017 - IMFnews

Conventional-Conforming Market Tapped into Surging Refi Business in 3Q17

Roughly $269 billion of conventional-conforming loans were originated from July through September, according to Inside Mortgage Finance...

November 15, 2017 - IMFnews

Speculation Mounts: More Banks May Exit Mortgages

Meanwhile, there’s already speculation that Capital One – known for its prowess in credit cards – might eventually re-enter the mortgage business in one way or another.

November 14, 2017 - IMFnews

HMDA Analysis: Higher-Priced Lending Spikes

Some $28.61 billion of non-government-insured higher-priced mortgages were originated in 2016, up 28.9 percent from the previous year…


With originations expected to drop in 2018, will your shop turn to non-QM/non-prime mortgage products as a way to bolster volumes?

Yes, definitely. We’re planning a launch.
No. It’s still difficult compliance/regulatory-wise.
Maybe. It’s under consideration.
Not now. But things could change as 2018 progresses.

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