If the mortgage industry doesn’t change the way flood risk is assessed, lenders could begin to “blue-line” certain areas, refusing to lend due to unacceptable flood risk, according to a paper published by the San Francisco Fed.
Lenders worry that including the language preference question on the URLA might expose them to litigation from non-English-speaking borrowers and slow down the homebuying process.
Not only is FHFA Director Mark Calabria homing in on a roadmap to end the conservatorship of Fannie and Freddie, he clearly believes the exit can take place before the two entities are fully capitalized.
Analyst Richard Bove thinks the new net worth sweep agreement is just a gimmick because the liquidation preference on Treasury’s preferred stock will offset any increase in the GSEs’ capital buffers.
Origination pipelines remain full and lenders, for the most part, are feeling optimistic about profits. Can it last? Probably, as long as rates remain low.
Fannie and Freddie can keep more of what they earn thanks to a new Treasury/FHFA edict, but buying stock in the two companies remains a dicey proposition.
Even though the Fifth Circuit Court of Appeals agreed that the structure of the FHFA is unconstitutional, GSE shareholders have petitioned for a Supreme Court review of their case.
Based on reports from non-QM lenders Angel Oak and Citadel, the third quarter was a strong one for most originators. Meanwhile, the Ditech wind-down is almost over.
In addition to making a decision on how DTI ratios should factor into determining QM status, the CFPB is being asked to endorse an automated underwriting system for the same.
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