May 18, 2012
Latest from Inside Mortgage Finance
The retained portfolios of both GSEs fell by 5.4% from the previous quarter according to Inside MBS & ABS
Flurry of Deals Scrambles Top Servicer Ranking In Early 2012, Nationstar to be Fourth Largest
While many of the largest mortgage lenders in the industry continue to scale back their operations in a somewhat precarious operating environment, a few companies see opportunity in the reshuffling and are hitting the gas pedal. None more than Nationstar Mortgage. Fresh off an initial public offering, the company has been on a buying spree for mortgage servicing and production capacity. Although Nationstar ranked as the 11th largest servicer in the market at the end of March, pending acquisitions would push it all the way to fourth place on a pro forma basis, according to a new...(Includes one data chart)
Mortgage Delinquency Rates Decline in Nearly All Categories, Foreclosure Inventory Little Changed
Mortgage servicers reported significant improvement in loan delinquency rates during the first quarter of 2012, although the inventory of foreclosed units remained at historically high levels. The overall delinquency rate dropped 100.3 basis points to 9.88 percent as of the end of March, according to the Inside Mortgage Finance Large Servicer Delinquency Index. That was the lowest level for the series in three years, and all 18 lenders included in the index reported lower delinquency rates than they had at the end of 2011. The biggest declines were in...(Includes two data charts)
Industry Views CFPB Pending Rule on L.O. Comp, Points, Fees Through Prism of Flawed Dodd-Frank
Mortgage lending industry representatives are apprehensive about how the underlying economics of originating a mortgage are going to be affected by a proposal expected sometime this summer from the Consumer Financial Protection Bureau. Among the issues the CFPB indicated it will be considering is a requirement that consumers get a lower interest rate when they pay discount points. The bureau is also thinking about requiring lenders to offer consumers a no-discount-point loan option, as well as banning origination charges that vary with the size of the mortgage. The CFPB is also going to look...
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Inside Regulatory Strategies
CFPB Taking on Origination Points and Fees
Mortgage originator compensation has moved clearly into the crosshairs of the Consumer Financial Protection Bureau as part of a broader proposed rule expected soon that will also address originator qualifications as well as the paying of discount points and fees. Senior CFPB officials briefed the press last week on their plans, which will be shared in greater detail sometime next week with a group of small businesses related to the mortgage lending industry per the Small Business Regulatory Enforcement Fairness Act. The act requires the bureau to convene a small business panel...
Inside FHA Lending
Beware of Conflicting FHA Rules, Standards
Mortgage servicers could find themselves in a quandary as they implement the national servicing standards outlined in the March foreclosure settlement agreement, especially if they run into conflicting FHA requirements. Compliance experts say that while many of the settlement standards could be carried out within the FHA program without being at odds with existing FHA requirements, conflicts do exist with the guidelines that cannot be resolved. Even when it is technically possible to comply with both FHA guidelines and the settlement standards, it is still going to ...
Inside Nonconforming Markets
Non-Agency Market Dwarfed by GSEs, Industry Looks for Ways to Move Ahead
“The private market will never come back if the best deal for the private investor is the government,” Lewis Ranieri, chairman and founding partner of Ranieri Partners, said this week at the Mortgage Bankers Association’s National Secondary Market Conference in New York City. Talk at the conference focused on almost anything other than activity in the non-agency market. David Stevens, president and CEO of the MBA, said dealing with repurchase issues ...
Inside MBS & ABS
Mortgage Bankers Push for Common MBS ‘Currency’ Making Fannie and Freddie MBS Interchangeable
The Mortgage Bankers Association is pushing a proposal to change the remittance schedule on Freddie Mac participation certificates and make them fully fungible with Fannie Mae pass-through MBS for good delivery under to-be-announced guidelines. The proposal would address the historical discount to Fannie MBS at which Freddie securities trade, said MBA President Dave Stevens during the group’s National Secondary Market Conference in New York this week. Freddie PCs typically trade 1 or 1.5 points behind Fannie MBS, a difference that Freddie Mac – and ultimately U.S. taxpayers, now that the government-sponsored...
Inside Mortgage Trends
Gains in Mortgage Banking Profits Widespread in 2012 First Quarter
Nearly all major lenders have reported increased earnings from their mortgage banking activities during the first quarter of 2012, according to a new Inside Mortgage Trends analysis of earnings reports from 25 companies. As a group, the 25 public companies posted an impressive $7.606 billion in mortgage banking income during the first three months of 2012. That was up 39.0 percent from the $5.471 billion these same firms earned over the final three months of 2011, and it was a huge 177.4 percent increase over the first quarter of last year. The group’s first-quarter mortgage banking...(Includes one data chart)
Inside The GSEs
FHFA Feud Over GSE Writedowns Intensifies
The Federal Housing Finance Agency is still mulling over accepting principal reduction payments from the Treasury Department even as the debate between the factions for and against GSE loan writedowns is quickly dissolving into a partisan food fight. This week, two ranking House Republicans urged FHFA Acting Director Edward DeMarco to stand fast against mounting political pressure directed at him by the Congressional allies of the Obama administration as House Democrats took the gloves off, accusing the Finance Agency of falsely withholding pertinent information about the agency’s principal reduction analysis.
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