Mortgage performance declined somewhat in the third quarter of 2016 compared with the previous quarter, according to the Inside Mortgage Finance Large Servicer Delinquency Index. The increase in delinquencies and foreclosures was part of a seasonal trend seen in recent years. The large servicers reported a total delinquency/foreclosure rate of 5.08 percent as of the end of the third quarter, up 8.6 basis points from the previous quarter. The increase was driven by new delinquencies across various buckets – largely concentrated among FHA mortgages – while the foreclosure rate decreased slightly. Every year since 2011, the total delinquency/foreclosure rate has increased...

Ginnie Mae’s decision to change the pooling requirements for streamline refinance loans should boost investor confidence and slow new production of GNMA IIs, Deutsche Bank analysts said. The change could be seen as mildly more restrictive than current pooling standards, particularly having more impact on VA loans, which unlike FHA, have no seasoning requirement to qualify for streamline refinancing, said Jeana Curro, bank research analyst. Under new guidance issued last month, in order to be pooled into standard Ginnie I or Ginnie II multi-issuer pools, streamline refi loans must show...

Mortgage lenders and servicers could see a dramatic change in the regulatory environment following the election of Donald Trump as president with a GOP-controlled Congress. During a campaign of many and sometimes conflicting promises, Trump vowed to repeal the Dodd-Frank Act, which would require Congressional action and, if carried out in its entirety, would abolish the Consumer Financial Protection Bureau. Some observers think a more likely outcome is a restructuring of the CFPB itself and curbing of some regulatory and enforcement actions, perhaps with new leadership. Mortgage lending issues were...

The primary mortgage insurance market remained on track for its best year ever during the third quarter of 2016, as the government-insured sectors gained some ground on private MIs, according to a new Inside Mortgage Finance ranking and analysis. Mortgage lenders originated a record $220.46 billion of home loans with some form of primary MI during the third quarter, a 16.6 percent increase from the previous period. That brought year-to-date primary MI activity to $553.77 billion, just $92.40 billion less than the all-time annual record of $646.17 billion set in 2015. The government-insured market – mostly FHA and VA – was...[Includes three data tables]

The question of whether FHA should do another mortgage insurance premium reduction is pretty much on stakeholders’ minds as they anticipate the release of the annual actuarial review of the Mutual Mortgage Insurance Fund next week. Analysts, however, are not ready to change their opinion that further MIP cuts are unlikely. Some analysts said they would reconsider their views if the upcoming report showed strong growth in the MMI Fund, while others believe FHA’s priorities today are different than they were in early 2015, when the agency cut the annual premium for forward mortgages to 0.85 percent. The FHA’s decision to lower the annual MIP was spurred...

The U.S. mortgage market produced an estimated $580.0 billion of first-lien originations during the third quarter of 2016, according to a new Inside Mortgage Finance analysis and ranking. That was up 13.7 percent from the second quarter, and it marked the strongest origination cycle since the fourth quarter of 2012, when $584.0 billion of new loans flowed through the pipes. The robust third quarter brought year-to-date originations to $1.470 trillion, up 8.9 percent from the first nine months of 2015. Lender feedback and agency mortgage-backed securities data suggest...[Includes two data tables]

Nonbanks crossed a threshold in the third quarter of 2016, posting a hefty 6.3 percent increase in their combined Ginnie Mae servicing portfolio, according to a new Inside FHA/VA Lending analysis. Nonbanks serviced $826.6 billion of Ginnie single-family mortgage-backed securities as of the end of September. That represented 51.3 percent of the total Ginnie market. The nonbank servicing total includes a small amount of Ginnie servicing held by state housing finance agencies, roughly 1.0 percent of the entire market. But it doesn’t include the significant amount of Ginnie servicing that nonbanks do as subservicers for both depository and nonbank clients. Interestingly, the biggest gain for nonbanks in percentage terms came in servicing VA loans, which rose 8.1 percent from the second quarter to $252.1 billion, or 51.0 percent of the market. The VA sector is one business from ... [4 charts ]

The Department of Housing and Urban Development called on its inspector general to reassess estimated financial losses to the FHA insurance fund, which an IG audit attributed to lengthy delays of servicer foreclosures and property conveyances. A recent audit report by the HUD inspector general alleges that HUD paid approximately $2.23 billion in claims for an estimated 239,000 properties that missed foreclosure and conveyance deadlines. According to the IG report, HUD paid an estimated $141.9 million for servicers’ claims for “unreasonable and unnecessary” debenture interest on the distressed loans, as well as $2.09 billion in servicer claims for holding the properties past their foreclosure and conveyance deadlines. While it was necessary for servicers to pay for property-preservation costs, HUD should not have paid for holding costs, the ...

Norwich Commercial Group has launched a new division, Military Direct Mortgage, to focus exclusively on VA direct-to-consumer lending. Based in Avon, CT, just down the road from its parent company, Military Direct opened for business in August this year and the timing could not have been better. In September, issuance of securities backed by VA loans totaled $22.3 billion, up from $18.1 billion in August, according to Ginnie Mae data. VA loan originations saw a 17.4 percent increase in the third quarter from the previous quarter, and were up 22.3 percent over the nine-month period compared to last year. VA purchase-mortgage volume for September totaled $9.9 billion, up after a slight drop in August. Purchase-mortgage activity also improved by 26.1 percent in the third quarter, and by 16.5 percent year-over-year. VA refinance volume featured a huge 34.0 percent increase in ...

The Department of Housing and Urban Development inspector general, over the last several weeks, has reported a series of final civil actions that resulted in an enforcement action or monetary settlement between an FHA lender and the federal government. On Oct. 6, the IG announced the results of an audit of TXL Mortgage Corp., a direct endorsement lender, in Houston. The audit found TXL in violation of HUD requirements and that it had no acceptable quality-control plan in place. Specifically, 16 of the 20 sample loans the IG reviewed did not comply with HUD standards. Of the 16 loans, eight had significant underwriting defects and failed to qualify for FHA mortgage insurance. Two loans qualified but were over-insured, according to the report. As a result, TXL exposed HUD to more than $713,000 in unnecessary insurance risk and caused the department to incur more than ...