Production of FHA-insured jumbo loans ballooned in the third quarter of 2014 reflecting heightened activity in this loan segment during the period. A 23.7 percent quarter-over-quarter surge helped push FHA jumbo lenders’ total volume to $7.71 billion at the end of the nine-month period ending Sept. 30. It was a significant increase for a segment that represents only a sliver of FHA’s overall business. However, compared to last year’s first nine months, volume was down by almost half (48.8 percent) as lenders struggled to keep pace with last year’s output. Strong purchase demand helped drive FHA jumbo originations (all FHA loans over $417,000 up to $625,500 in high-cost areas), as purchase mortgages accounted for 81.1 percent of all FHA jumbos originated during the first nine months of the year. Fixed-rates comprised 86.4 percent of FHA jumbos originated during ... [1 chart]

The FHA and Ginnie Mae will share in the record-setting $16.7 billion settlement between Bank of America, the Department of Justice and certain other federal agencies and six states to resolve claims related to mortgage fraud and toxic mortgage-backed securities. The FHA will receive approximately $800 million and an undisclosed amount for consumer relief from BofA. The bank was accused of falsely certifying poorly underwritten loans for FHA insurance, resulting in huge losses for the agency. It is unclear how much Ginnie Mae’s share would be from the settlement. “As a direct endorser of FHA-insured loans, Bank of America performs a critical role in home lending,” said U.S. Attorney Loretta Lynch for the Eastern District of New York during the announcement of the global settlement in August. “In obtaining a payment of $800 million and sweeping relief for troubled homeowners, we have not ...

Final PMIERS Rule Expected in 1Q15. The Federal Housing Finance Agency has revised its timeline for publishing a final version of the Private Mortgage Insurance Eligibility Requirements, which Fannie Mae and Freddie Mac proposed in July at the direction of the FHFA. The PMIERS will establish capital and other requirements for private mortgage insurers. In a statement, industry trade group U.S. Mortgage Insurers said it has received word from the agency that the final PMIERS would not be published until at least late in the first quarter of 2015. The FHFA initially indicated that a final rule would be issued by yearend 2014. The USMI reiterated its support for an updated PMIERS. Mortgage Executives Concerned About G-Fee Increase. A survey of mortgage executives at this year’s Mortgage Bankers Association annual conference found 53 percent saying that ...

With just over four weeks left in 2014, investment bankers expect a flurry of bulk deals to hit the market. But whether they close or not is a different matter. “There are definitely several deals – both large and small – that are being considered,” said Tom Piercy, managing member of Interactive Mortgage Advisors. “We are working on four or five deals totaling $10 billion.” Piercy said he wasn’t at liberty to provide details about the transactions since some have yet to be finalized. In two recently announced auctions, IMA is selling a $3.2 billion package of Fannie Mae/Freddie Mac mortgage servicing rights and a $1.6 billion pool.The brokerage firm also is in the process of selling a New York-based mortgage ...

The economic value of the FHA’s Home Equity Conversion Mortgage legacy portfolio fell to negative $0.9 billion in fiscal 2014 due mainly to volatility in long-term house prices and interest rates, according to the latest independent actuarial report on the health of the Mutual Mortgage Insurance Fund. The latest result was a significant improvement from FY 2012, when the fund stood at negative $2.8 billion. In fiscal 2013, the HECM portfolio’s economic value of positive $6.5 billion appeared to be a whopping change from the previous year but that amount reflected a $4.6 billion cash infusion from the forward program and from the $1.7 billion mandatory appropriation, the report clarified. The report also showed a corresponding decline in the HECM capital ratio to negative 1.20 percent. Actuarial projections for fiscal 2015 place the HECM portfolio’s economic value at negative $1.1 billion. The fund’s capital resources for ...

Essent EVP to Retire in March. Adolfo Marzol, Essent Guaranty’s executive vice president, will step down, effective March 31, 2015, after five years with the company. VA Hybrid Adjustable-Rate Mortgage Pooling Eligibility. The Department of Veterans Affairs recently expanded the type of loans it will guarantee to include 7/1 and 10/1 hybrid ARMs. While Ginnie Mae’s Mortgage-Backed Securities Guide does not bar the inclusion of hybrid ARMs in Ginnie MBS, GinnieNET is not currently able to process these loans for pool processing. GinnieNET is being updated in order to accommodate VA 7/1 and 10/1 hybrid ARM pooling. Effective with issuances dated on or after Dec. 1, 2014, VA 7/1 and 10/1 hybrid ARMs will be eligible for pooling. CFPB Publishes Revised List of Rural and Underserved Counties. The Consumer Financial Protection Bureau has published its 2015 list of ...

Ginnie Mae servicing bumped up slightly in the third quarter after an uneventful prior quarter as FHA purchase activity continued to drag, according to Inside FHA Lending’s analysis of agency data. Servicing volume rose quarter over quarter by 1.4 percent. On an annual basis, volume increased 4.6 percent from the same period a year ago. Ginnie Mae servicers ended the quarter with a total of $1.48 trillion in unpaid principal balance, up from $1.46 trillion in the previous quarter. The top three servicers saw volume drop on both quarterly and year-over-year bases. Wells Fargo remained as top servicer of Ginnie Mae mortgage-backed securities, closing out the quarter with $422.4 million, down 0.8 percent from the previous quarter and down 0.6 percent from the prior year. The mega-servicer dominated the Ginnie market with a 28.6 percent market share. JPMorgan Chase carved out a 10.1 percent market share with ... [1 chart]

Production of rural housing loans with a Department of Agriculture guaranty is expected to end 2014 far below the record volume originated last year, according to agency estimates. USDA Section 502 guaranteed homeownership obligations in fiscal 2014 totaled $19.1 billion, down from last year’s $22.4 billion, according to data recently disclosed by the agency. Texas led...[Includes one data chart]

Ginnie Mae this week provided new details to the long-anticipated plan for increased issuer net worth and liquidity and a new performance scoring method for issuer activity – changes that could adversely affect small issuers and portfolio servicers. In remarks at the Mortgage Bankers Association’s annual convention in Las Vegas, Ginnie Mae President Ted Tozer said the changes are part of a larger effort to ensure the continuing flexibility and availability of the agency’s mortgage-backed securities program to as many entities as possible. New types of issuers and counterparties have entered the agency-backed MBS market in the wake of the financial crisis, which called for adjustments and tailored approaches to the evolving housing finance market, Tozer noted. Tozer said both policy changes and staff expertise will ensure the success of ...

FHA reverse mortgage volume fell in the second quarter as well as during the first six months of 2014 as regulatory changes reduced profitability and increased the cost of originating the government-backed product, according to Inside FHA Lending’s analysis of agency data. Home equity conversion mortgage volume declined 19.9 percent quarter-over-quarter and dropped 9.0 percent during the first half of the year compared to the same period last year. HECM lenders reported $7.2 billion in total originations in the first half, with purchase loans accounting for 93.6 percent. Fixed-rate HECMs comprised only 22.2 percent of total volume as most borrowers turned to adjustable-rate HECMs for their reverse-mortgage needs. The top five HECM lenders – American Advisors Group, Reverse Mortgage Solutions, One Reverse Mortgage, Liberty Home Equity Solutions and Proficio Mortgage Ventures – accounted for ... [1 chart ]