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Inside Mortgage Trends

October 9, 2015

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Top GSE Sellers Expand Combined Market Share Slightly, Correspondent Channel Grows

After a long, steady decline in their combined market share, the top five sellers of home mortgages to Fannie Mae and Freddie Mac posted a modest increase during the third quarter of 2015. The top five sellers delivered $67.66 billion of loans to the two government-sponsored enterprises during the period for a 30.3 percent share of the market, according to a new Inside Mortgage Trends analysis. That was up from 29.8 percent in the second quarter and ... [Includes two data charts] Read More

Properly Structured MSAs are Viable… For Now

Despite the uncertainty over marketing services agreements caused by Consumer Financial Protection Bureau enforcement actions, MSAs are still legal and viable, as long as they are properly ordered, according to industry experts at Lenders Compliance Group, a consulting firm in Long Beach, NY. During a webinar this week, three compliance pros at the firm delved into the first big splash the CFPB made on the MSA front, its Sept. 25, 2014, consent order with ... Read More

Vendors Look to Help Lenders Comply With TRID

Mortgage lenders have entered a new, unfamiliar zone of regulation with the TILA-RESPA Integrated Disclosure (TRID) rule, which became effective on Oct. 3. The Stratmor Group, a mortgage consulting firm, said reaching out to borrowers prior to loan closing increases borrower satisfaction significantly, which regulators may view as a positive indicator of good-faith efforts to comply with the complex new rule. “One aspect of TRID compliance is making sure that the customer ... Read More

Support for Proposed MSR Accounting Change

A proposal from the Financial Accounting Standards Board that would impact accounting for mortgage servicing rights is getting support from industry trade groups. In August, FASB issued proposed accounting standards covering derivative contract novations on existing hedge-accounting relationships. A task force at the accounting standard setter had found that guidance in generally accepted accounting principles wasn’t explicit on the effect of a ... Read More

Mortgage Hiring Is Mostly Flat as Summer Ends

Mortgage banking firms managed to increase their employee rolls by 1,200 workers as autumn began, even though traditionally this is the time when lenders cut back. Hiring at mortgage brokerage shops remained relatively flat at 77,100, according to figures compiled by the Bureau of Labor Statistics. BLS found that mortgage banking companies had 218,300 full-timers on their payrolls at the end of August, a meager sequential gain of 0.5 percent. The figures, which are seasonally adjusted, do not distinguish between production and servicing workers. Read More

How to Find a Good Subservicer

A significant percentage of active Ginnie Mae issuers use subservicers in their operations, and agency officials estimate that 22 subservicers handle roughly a third, or $510 billion, of the program’s portfolio. The four top subservicers handle approximately 21 percent of Ginnie’s total portfolio or 65 percent of the subserviced portion. During the recent Ginnie Mae annual conference in Arlington, VA, representatives from Lakeview Loan Servicing, Pingora Asset Management and ... Read More

More Borrowers Cash Out Home Equity in 2Q15

The volume of cash-out refinance in the second quarter reached its highest level in five years as more borrowers take advantage of rising home values, according to Black Knight Financial Services. Cash-out refinance volumes in the second quarter of 2015 rose close to 70 percent from the same period last year, said Ben Graboske, a Black Knight senior vice president. Today’s levels are comparable to those in 2006, with borrowers now taking out an average of ... Read More

Mortgage Activities Profitable for Smaller Banks

In the years after the financial crisis, returns on mortgage-banking activities have been more profitable for smaller banks than for large banks, according to researchers at the Federal Reserve. In an analysis of about 1,000 banks, William Bassett, a deputy associate director, and John Driscoll, a senior economist, found that returns on mortgage sales and securitization have been higher for community banks than for larger banks. Community banks also had higher returns on ... Read More

Did the QM Rule Raise Loan Denial Rates?

A slightly larger percentage of mortgage loan applications were turned down by lenders in 2014 than in 2013, according to Home Mortgage Disclosure Act data. The reason may be linked to the early 2014 effective date for the ability-to-repay rule and the qualified mortgage standard. The two most common reasons for loan denial have historically been poor credit history and excessive debt-to-income ratio. Both became more prevalent in 2014 ... [Includes one data chart] Read More

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