Private mortgage insurers posted an impressive 26.5 percent increase in new insurance written during the third quarter of 2012, but four of the industry’s six active firms are gradually taking market share away from their rivals. Private MIs insured $51.76 billion in new mortgage originations during the third quarter, according to a new Inside Mortgage Finance ranking and analysis, making it the strongest quarter for the beleaguered industry since the second quarter of 2008. FHA and VA lending grew at a much slower pace, climbing just 2.1 percent and 4.0 percent, respectively, during the third quarter. The result was...[Includes two data charts]

The private mortgage insurance industry is expressing optimism with the positive changes seen lately in the housing market while hoping that Congress or the Obama administration do nothing to impede or spoil the market’s recovery. Industry executives say stabilizing home values, low interest rates, better quality mortgages and a shrinking FHA share of the mortgage market are helping MIs win back market share and write new business. “Everybody is trying to write as much business as they can to regain share,” said Michael Zimmerman, senior vice president for investor relations at Mortgage Guarany Insurance Corp. New insurance written is...

Although mortgage market watchers cautiously expect President Obama and the lame-duck session of the 112th Congress to come up with at least a stop-gap deal to avoid the looming “fiscal cliff” at year’s end, building uncertainty among homeowners and potential borrowers as to whether important mortgage tax deductions will exist in 2013 threatens to thwart housing’s fragile recovery. Unless Congress and the president create and sign new legislation to change existing law before Jan. 1, 2013, taxpayers are poised to be hit with a massive combination of expiring tax breaks, tax hikes and deep, automatic federal spending cuts. A report last week by the Congressional Budget Office concluded that a failure to avoid the cliff would push the economy back into recession with the unemployment rate shooting up to 9.1 percent by next fall. Fitch Ratings warns...

Wells Fargo has asked a federal district court in Washington, DC, to declare the U.S. government in violation of the terms of the landmark $25 billion mortgage servicing fraud settlement earlier this year that resolved federal and state claims against the bank and four other major servicers for alleged servicing malpractices. In a complaint filed last week, Wells Fargo also asked the D.C. court to order the Department of Justice to halt all legal actions seeking to impose additional liability on Wells Fargo based on a ...

There is substantial risk that the FHA may end up with a negative net worth, which would require congressional appropriations for the mortgage insurance fund and passage of legislation reforming the FHA, said a former top official at the Department of Housing and Urban Development. In remarks this week at the Urban Institute, John Weicher, former assistant secretary for housing and FHA commissioner in 2001-2005, said it is very unlikely in this weak economic recovery to see ...

The volume of loans guaranteed by the Department of Veterans Affairs rose 4.0 percent in the third quarter of 2012, reflecting an upward trend that the agency attributes to strong underwriting. A production increased to $33.3 billion from $32.0 billion in the second quarter and $28.3 billion in the first quarter. The agency reported $93.6 billion in total originations over the nine-month period, with refinancing accounting for 51.8 percent of guaranteed loans. “VA has had the best performing loans in the industry for quite some time, with the ... [1 chart]

Banks that say they were less likely to approve an application for an FHA-insured mortgage cited a higher risk of putback of delinquent mortgages by the FHA as an important reason for the change, according to the Federal Reserve’s latest survey of bank lending practices. Responding to a special question on FHA lending, 14 of the respondents (36.8 percent) ranked putbacks as a “very important” issue, nine banks (23.7 percent) thought it was the “most important” while an equal number said it was “somewhat important.” Nine of the 14 respondents were ...

A second-term Obama administration is expected to continue support for lowering maximum loan-to-value ratios and upward premium pricing to strengthen the FHA’s Mutual Mortgage Insurance Fund, according to the Mortgage Bankers Association. While President Obama has indicated an interest in reducing the FHA’s presence in the mortgage market for a larger private sector role in mortgage finance, he is inclined to proceed cautiously so as not to disrupt consumer access to affordable FHA financing, said MBA President/CEO David Stevens. Stevens observed that Obama has been ...

Hurricane Sandy homeowners with FHA and VA mortgages have been given temporary relief, including a 90-day suspension on foreclosures and as much as 100 percent financing for victims who have lost their homes. The Department of Housing and Urban Development and the Department of Veterans Affairs have announced federal disaster assistance to hard-hit areas in Connecticut, New York and New Jersey. Both agencies announced a three-month freeze on foreclosures in the affected areas as well as forbearance on foreclosures of FHA and VA home loans. The VA advised its lenders that careful counseling should ...

GSEs, Private MIs Agree to Drop Pre-Approval Requirements. Fannie Mae and Freddie Mac and the private mortgage insurance industry have agreed to eliminate pre-approval requirements for foreclosure alternatives, such as short sales and deeds-in-lieu of foreclosure. The separate agreements with MIs should help distressed homeowners avoid foreclosure by doing away with costly, time-consuming MI reviews that delay foreclosure-prevention transactions, according to the government-sponsored enterprises. WIMC Fully Acquires Reverse Mortgage Solutions. Walter Investment Management Corp. has completed its $120 million acquisition of ...