Some FHA lenders are seeing new opportunities in the distressed property market as they offer new or expand on existing 203(k) rehabilitation mortgage insurance products. Houston-based Envoy Mortgage, a full-service mortgage banker with retail branches across the country, has broadened its FHA 203(k) product line to include a full 203(k) option. The option allows borrowers to devote more funds for repair and renovation, which are rolled into the mortgage amount. The full 203(k) option is a step up from what Envoy is already offering – a “streamline” 203(k) program designed for borrowers that have ...

Rule for Selling Government Mortgages to Fannie Mae Updated. Eligibility for delivery of mortgage loans backed by FHA, VA and the Department of Agriculture is now available on a negotiated basis only, Fannie Mae announced in a recent update to its Selling Guide (Announcement SEL-2013-01). The change is effective for all government loans, including whole loans sold to Fannie on or after May 1, 2013, and government loans in mortgage-backed securities with issue dates on or after May 1. Genworth to Delink Struggling Mortgage Insurance Operations from Holding Company. Genworth Financial plans to ...

In the end, there were no earth-shattering surprises in the Consumer Financial Protection Bureau’s final rule on mortgage originator qualification and compensation, but the residential finance industry isn’t quite done digesting the myriad details of the 541-page regulation, which goes into effect a year from now. Among many things, the rule codifies the difference between bank and nonbank loan officers, requiring the latter to get tested on a regular basis, a distinction that does not sit well with certain factions of the mortgage banking and brokerage industries. “The point is...

Stringent appraisals have hindered home sales, limiting purchase-mortgage originations and constraining home prices, according to real estate agents responding to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. Appraisers counter that they are accurately pricing homes and cite burdensome regulations along with new requirements from lenders trying to avoid buybacks. In certain circumstances, appraised home prices have been set well below listing price, frustrating sellers that have received multiple offers. “Appraisals continue to cause problems as the market is trying to recover value, but tight appraiser guidelines are not keeping up with the agreed sales prices between buyers and sellers,” according to a real estate agent in Michigan. The sales-to-list price ratio has trended...

Fannie Mae is informing the mortgage cooperatives it works with that going forward that all the different affinity groups doing business with the government-sponsored enterprise will be treated the same when it comes to guaranty fees and charges for its Desktop Underwriter program, Inside Mortgage Finance has learned. One executive close to the situation told Inside Mortgage Finance that action by Fannie essentially “equalizes” all cooperatives in terms of the pricing breaks they receive from the GSE. Some affinity relationships have been in place...

A few weeks ago, ES Appraisal Services, Jacksonville, FL, closed its doors, the second national appraisal management company to go bust in the past year. The other was Appraisal Loft. ES Appraisal’s demise was a hardly a surprise. For months, industry message boards were full of comments from independent appraisers who worked as contractors for the firm, complaining about unpaid invoices. In December, the company sent an email to appraisers confirming the news. At one point the firm employed, on a contractual basis ...

Interest rates on adjustable-rate mortgages fell to their lowest level ever early this year, but consumers continue to prefer fixed-rate products. Freddie Mac reported that the average initial rate for one-year ARMs offered in early January was just 2.56 percent, the lowest ever recorded in its 29-year-old survey. Fewer than half the participating lenders offer one-year ARMs, but initial rates on the more common three-year and five-year hybrids were 2.72 percent and ... [Includes one data chart]

The CFPB has issued its long-awaited and much-discussed ability-to-repay final rule, and the initial review of the 800-plus page document is that the bureau generally succeeded in navigating a moderate course, giving lender groups and consumer groups some but not all of what each wanted. In short, the rule creates a general definition of a qualified mortgage that addresses product standards, features minimum underwriting and documentation requirements, and limits “points and fees” to 3 percent. In terms of product...

Illustrating the relative success the CFPB had in striking a middle-of-the-road tone in its ability-to-repay final rule, nearly every interested public and private constituency seemed to find some things to like and other things to be concerned about in the end product. The Mortgage Bankers Association, like many lending and real estate groups, said it was pleased the bureau provided a legal safe harbor to lenders when they originate loans that meet the QM standards in the rule. “This approach should allow lenders to...

In addition to the ability-to-repay rule itself, the CFPB has issued a proposal to seek comment on whether to adjust the final rule for certain community-based lenders, housing stabilization programs, certain refinancing programs of Fannie Mae or Freddie Mac and federal agencies, and small portfolio creditors. The bureau wants to know whether the rule should be modified to address potential adverse consequences on certain narrowly-defined categories of lending programs. Specifically, the proposal includes amendments...