Ginnie Mae FY 2016 Highlights. “So far, we’ve pretty much broken every record,” said a Ginnie Mae spokesperson. Total mortgage-backed securities issuance for FY 2016 was $490.3 billion, “an all-time high by a pretty wide margin,” according to the spokesperson. September MBS issuance was also at an all-time high: $54.8 billion. Ginnie Mae commitment authority for the fiscal year was $430.2 billion. Approximately 2.3 million mortgage loans worth $462 billion underlay Ginnie’s single-family MBS pools in FY 2016. Of this total, $278 billion (1.4 million loans) were purchase mortgages, and $184 billion (0.9 million loans) were refinances or modified loans. Of the purchase dollar volume, first-time homebuyers accounted for $200 billion (1.1 million loans). Of the $462 billion single-family MBS pools, FHA accounted for 57.1 percent ($264 billion), VA, 38.8 percent ($179 billion), and rural housing loans, 3.9 percent ($18 billion). New California Law Protects Spouses of HECM Borrowers from ‘Widow Foreclosure.’ On Sept. 29, 2016, California Gov. Jerry Brown, D, signed Senate Bill 1150 into law to protect widows, widowers and other heirs of mortgage borrowers from unnecessary foreclosures.

Fannie Mae and Freddie Mac securitized $135.69 billion of single-family purchase mortgages during the third quarter, according to a new Inside Mortgage Finance analysis of mortgage-backed securities disclosures by the two government-sponsored enterprises. That was up a hefty 26.2 percent from the previous quarter, and it represented the biggest quarterly flow of purchase mortgages to the GSEs since the housing market collapse. Although the loans were pooled in MBS issued during the third quarter, a significant number of them were actually originated during the April-June cycle. The third quarter typically has...[Includes three data tables]

Continued increases to home prices along with low interest rates have prompted a number of borrowers to take cash out when completing a refinance. Some 41.0 percent of refinances completed in the second quarter of 2016 resulted in a loan amount at least 5.0 percent higher than the unpaid principal balance of the original loan, according to Freddie Mac. In the second quarter of 2015, the share was 33.0 percent and between 2010 and 2013 it typically ranged from 15.0 percent to 20.0 percent, according to Freddie. The total amount of home equity cashed out has also increased...

The Department of Veterans Affairs is working on a change to its existing streamline refinancing policy to address a problem that is giving VA and Ginnie Mae the fits. Under the VA’s qualified-mortgage rule, a VA borrower must wait six months and show six months’ worth of mortgage payments before they can refinance into an IRRRL (Interest Rate Reduction Refinance Loan) and take advantage of the lower rate. However, it seems not all VA lenders are adhering to the rule and that a good number are refinancing veterans into IRRRLs even before the mandatory seasoning period ends for fear interest rates might rise and the borrower might not benefit from the lower rate. “I’ve redone the numbers in 20 different directions on how much a borrower would save if they had to wait two more months and the rate went up a quarter of a point because they lost those two months ...

Ginnie Mae continues to wrestle with issuers lacking liquidity and net worth although the number of such cases has gone down significantly, thanks to tight oversight, according to the agency’s top counterparty risk officer. Briefing participants at this year’s Ginnie Mae summit in Washington, DC, Zack Skochko, director of counterparty risk, reported that some issuers are still struggling to comply with Ginnie Mae’s liquidity and net worth requirements.A number of small issuers failed their liquidity and net worth audits this year by not maintaining the minimum $1 million cash or 10 basis points of outstanding Ginnie securities required to participate in the agency’s mortgage-backed securities program. Ginnie Mae also requires issuers to meet a minimum net worth of $2.5 million plus 35 bps of the issuer’s total effective single-family obligations The requirements were designed to ensure that the ...

Originations of mortgages to first-time homebuyers in recent years have performed better than other purchase mortgages securitized by the government-sponsored enterprises, according to an analysis by Moody’s Investors Service. The stronger performance of first-time homebuyers occurred even as purchase mortgages for repeat buyers tend to have stronger borrower characteristics. The rating service suggested that tighter underwriting coupled with borrower education and counseling have improved the performance of GSE first-time homebuyer mortgages. Moody’s said...

Although single-women borrowers are more likely to pay their mortgages on time than single-male borrowers, they tend to pay higher mortgage rates and are more often denied credit. Those findings come from a new Urban Institute study that merged Home Mortgage Disclosure Act data for 2004-2014 with CoreLogic data on loan performance. A combination of a male and female borrower (usually in that order) accounted...

The first rated post-crisis non-agency MBS backed by a significant share of nonperforming mortgages paid off recently, offering insights into how the deal performed and how investors fared. The $372.80 million Mortgage Fund IVc Trust 2015-RN1 was issued by Bayview Asset Management in October 2015. It received “A” ratings from Fitch Ratings and Morningstar. Fitch said it capped its rating “due to the idiosyncratic and adverse-selection risks associated with NPL collateral.” At issuance, 34.9 percent of the loans were nonperforming and 78.0 percent had been modified. The rating services said...

VA refinance mortgages accounted for the biggest share of total insured refis during the first six months of 2016, according to an Inside FHA/VA Lending analysis of agency refi data. On a monthly basis, VA refi totals exceeded refis with FHA and private mortgage insurance, peaking at $9.3 billion (58.1 percent of total VA originations) in April. Over the six-month period, the refi share of VA loans securitized by Ginnie Mae averaged 52.3 percent, compared to 29.6 percent for FHA and 21.0 percent for private MI loans securitized by Fannie Mae and Freddie Mac. In terms of total volume, however, FHA held a commanding lead, $123.0 billion, over private MIs ($102.7 billion) and VA ($84.8 billion). Interestingly, the average interest rate on VA refi loans, 3.6 percent, over the six-month period was lower than FHA’s and private MIs’ note rates of 3.9 percent and 4.0 percent, respectively. There is no clear ... [1 chart]

Ginnie Mae issued $46.5 billion of single-family mortgage-backed securities in August, up slightly from July, according to an analysis of Ginnie data. Single-family MBS monthly issuance in August was the highest monthly volume so far this year. Total issuance also was up 12.3 percent from the same month last year., Strong purchase and refinance originations in the second quarter helped push production in the third quarter. Although purchase loans with private mortgage insurance outpaced gains in FHA and VA loans in the second quarter, deliveries to Ginnie so far appear to indicate a strong third quarter. Meanwhile, VA volume has been fueled largely by refinance activity over the past few years and does not appear to be letting up. PennyMac and Freedom Mortgage battled for first place with $4.35 billion and $4.34 billion, respectively, in MBS issuance in August. Despite cutting back on its ... [1 chart]