The Senate this week passed bipartisan legislation that would delay unforeseen, excessive flood-insurance premium hikes for FHA and conventional mortgages nationwide. S. 1926, the Homeowner Flood Insurance Affordability Act, passed by a vote of 67 to 32, as amended. Introduced by Sens. Robert Menendez, D-NJ, and Johnny Isakson, R-GA, the bill would delay rate increases for up to four years by giving the Federal Emergency Management Agency time to study the problem and develop a plan to help homeowners who cannot afford higher premiums. The increases were mandated by the Biggert-Waters Flood Insurance Reform Act, which Congress ...

Ginnie Mae is considering lengthening the approval time for transfers of mortgage servicing rights (MSRs) to 90 days or more from the current 30 days but has yet to issue guidance. The agency alerted sellers of MSRs and their investment banking advisors of the forthcoming change in late November at an “education summit” in Washington, according to a participant, who preferred anonymity. New and existing issuers participated in the event, and a copy of Ginnie Mae’s presentation was provided to Inside Mortgage Finance, an affiliated publication. Ginnie Mae declined to comment on the report. However, according to the presentation, the reason for ...

VA Lenders’ Compliance with CFPB’s Ability-to-Repay and Qualified Mortgage Rules. Until the Department of Veterans Affairs’ rule on ATR/QM is in place, all VA lenders must comply with the requirements of the Truth in Lending Act, as established by the Consumer Financial Protection Bureau’s ATR/QM rule, according to a recent agency guideline. VA will continue to guarantee all loans made in compliance with existing VA requirements, regardless of their QM status, the agency clarified. It urged lenders to refer to the CFPB guidance to ensure all their VA loans are ...

The Treasury Department’s point man on housing declared this week that the government has no appetite to expand the Home Affordable Refinance Program, and he reiterated past Obama administration pledges to cashier Fannie Mae and Freddie Mac. Michael Stegman, counselor to the Treasury on housing finance policy, outlined for attendees of the ABS Vegas conference the administration’s housing goals, including its opposition to any HARP eligibility tweaking and its continued support for housing finance reform.

A steady decline in GSE refinances throughout 2013 coupled with faltering purchase mortgage activity during the final third of the year helped contribute to an overall dip in the volume of single-family mortgages securitized by Fannie Mae and Freddie Mac both on a month-to-month and year-end basis, according to a new Inside The GSEs analysis. Fannie and Freddie issued $55.8 billion in single-family mortgage-backed securities in December, a 4.9 percent decline from November.

The Urban Institute said that new FHA loan limits may have a limited impact overall, but they could have dire consequences for some minority neighborhoods. The study found that the most affected metropolitan statistical areas had two things in common: they have a high share of FHA-insured loans, and their loan limits have dropped significantly. Of the 35 most affected MSAs, 13 are predominantly minority neighborhoods, all in California. “Many of the most affected areas have...

Agency single-family MBS issuance continued to decline as 2013 came to a close, with production in December dropping to just $75.77 billion – the lowest monthly total since July 2011, according to a new Inside MBS & ABS ranking and analysis. Agency MBS production declined steadily last year after peaking in April. For the year, total issuance was down 7.1 percent from 2012, and issuance plummeted 34.1 percent from the third to the fourth quarter. The biggest factor in the decline was...[Includes two data charts]

The Department of Housing and Urban Development sold 62,062 distressed loans in 2013 through its expanded Distressed Asset Stabilization Program (DASP) to increase recoveries to FHA’s Mutual Mortgage Insurance Fund. HUD made 10 offerings of nonperforming FHA-insured loans in a series of quarterly competitive auctions last year, participated in by pre-qualified bidders, including nonprofit organizations. The defaulted single-family mortgages were provided by FHA-approved loan servicers and sold through large national pools and “neighborhood stabilization outcome” pools. The NSO pools consist of loans in ...

The FHA's recently updated manual underwriting standards provide some objective criteria for qualifying more borrowers but, at the same time, some of those standards could bar certain people from obtaining an FHA mortgage, according to compliance experts. A key change in the guidelines is the lowering of the credit score threshold from 620 to 580 to allow manually underwritten borrowers – those that have received a “refer” recommendation from FHA’s Total Mortgage Scorecard or those that were not scored because they did not have credit scores – to use compensating factors in order to ...

Program eligibility is one of the top five reasons a loan can get an “unacceptable” rating in a post-endorsement technical review of a targeted sample of FHA loans. In a sample review conducted by FHA between July 1, 2013, and Sept. 30, 2013, 10 percent of the 6,692 targeted loans were defective due to program eligibility. Of that 10 percent, 76 percent were rated unacceptable by FHA. The results reflect the initial rating of each file reviewed during the quarter, which include conforming, deficient and unacceptable. An unacceptable rating may change if the lender submits mitigating documentation to FHA. But even if subsequently mitigated, the fact ...