Another Cut in FHA Premiums Coming This Winter? Will the FHA take the bold step of cutting annual mortgage insurance premiums this winter? It’s an intriguing question posed by Capital Alpha Partners. The research firm, in a new report, quotes what it calls a “reliable FHA bull” who “presciently foresaw” the last premium cut. Alpha cautions that its source on the matter is not betting on such a move, but raises the possibility “that the tumblers could fall into place once again.” One possible catalyst for an MIP cut would be poor results from a forthcoming Home Mortgage Disclosure Act report that shows FHA as well as Fannie Mae and Freddie Mac are not serving low-income borrowers very well. In January 2015, FHA implemented a half-percent reduction in annual mortgage insurance premiums. At the time, the Department of Housing and Urban Development predicted that 250,000 new homeowners would ...
Meanwhile, refinance lending rose just 0.9 percent from the first to the second quarter, but still accounted for just over half of new originations during the period.
One possible catalyst for a MIP cut could be poor results from a forthcoming HMDA report that shows FHA as well as Fannie Mae and Freddie Mac are not servicing low-income borrowers very well.
In a recent SEC filing Two Harbors noted that after the second quarter ended it bought $4.7 billion of Fannie Mae servicing rights from an undisclosed seller.
Purchase-mortgage lending provided most of the oomph that drove the 23.6 percent increase in total mortgage originations during the second quarter, but refinance activity still accounted for slightly over half of total production. Lenders funded $222 billion of first-lien purchase mortgages during the second quarter, a 59.7 percent increase from the first three months of 2015, according to Inside Mortgage Finance estimates. That was just shy of the $223 billion of purchase mortgages originated back in the third quarter of 2013, a figure that included some second-mortgage production associated with purchase loans. Meanwhile, refinance lending rose...[Includes three data tables]
Over the past year, small and medium-sized lenders have dominated the activity in the merger and acquisitions market, but all that could be changing as consolidation fever begins to gather steam and larger, struggling players consider a take-out strategy. Also, the recent announcement that the Blackstone Group would buy a majority stake in Stearns Lending – the nation’s 12th largest originator – has sparked hopes among investment bankers that potential sellers are finally lowering their expectations when it comes to price. An offering book on Stearns had been circulating for at least a year. Meanwhile, analysts who follow Stonegate Mortgage, which ranks 25th among originators, this week suggested...
The Department of Housing and Urban Development this week republished for comment new proposed changes to lender certification for FHA that would allow for minor lender errors while leaving the door open for government enforcement action under the False Claims Act. The proposed revisions, however, failed to impress mortgage lenders and raised the specter of increased overlays unless HUD makes clear assurances that, barring any significant mistakes, lenders will not be on the hook for millions of dollars for small glitches in the loan certification document. “The language in the certification lacks...