Fannie Mae and Freddie Mac continued to invest heavily in the non-agency subprime and Alternative A market in 2005, but it wasn’t enough to prevent the two government-sponsored enterprises from losing more ground in the mortgage market. With unexpectedly strong ARM business in the primary market and stiff competition from other MBS investors, 2005 wasn’t a highly favorable business climate for the two GSEs. In addition to their business challenges, Fannie and – to a… [One data table included]
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A potential 20 percent drop in origination volume in 2006 may spur more mortgage banking consolidation in 2006, but experts don’t expect to see a merger frenzy develop this year. Buying a mid-tier mortgage lender may be a good way to maintain volume and revenue in a tightening market, said Craig Focardi, a research director at TowerGroup. But mortgage company acquisitions will increase only “slightly” over the tepid pace of the past few years, he…
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Fannie Mae late last week dusted off a 15-year-old controversy when it announced a relatively modest plan to provide $10 billion in financing for home builders over the next decade. In a speech at the annual convention of the National Association of Home Builders, Fannie Mae CEO Daniel Mudd said the government-sponsored enterprise plans to ramp up its acquisition, development and construction program as part of its American Dream Commitment. He said Fannie has helped…
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Hurricanes Katrina and Rita did more than pulverize the Gulf Coast in Louisiana and Mississippi last year; they also revealed gaping problems in the federal flood insurance program that Congress now says it plans to fix. Lawmakers late last year approved legislation to raise the National Flood Insurance Program’s borrowing authority to $22 billion – the third such increase in 2005 made necessary to pay off hurricane claims. The latest bailout bill also included some…
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Mortgage lenders and other financial services providers are closely watching Congressional efforts to beef up data security requirements in 2006. With a number of different bills pending in various committees, industry sources say a key issue is whether Congress produces one strong piece of legislation, rather than multiple overlapping bills. …
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A surge in the share of federal thrifts that have received an “outstanding” rating in 2005 under the Community Reinvestment Act is an indication of a CRA grading system gone awry as a result of a controversial CRA rule implemented by the Office of Thrift Supervision last year, according to community reinvestment groups. …
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The Ginnie Mae servicing business remained concentrated in a group of large lenders at the end of 2005, with Wells Fargo Home Mortgage holding the biggest chunk of the market. Wells was servicing $89.5 billion of loans securitized through the Ginnie Mae program as of Dec. 31, or about 22.0 percent of the total market. That was down slightly from the company’s Ginnie servicing volume at the same time in 2004, but Wells did a… [One data table included]
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