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Inside Mortgage Finance

August 11, 2006

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Private Mortgage Insurers Enjoy Modest Gain In New Business as Flow Channel Strengthens

Mortgage Guaranty Insurance Corp. regained its customary position as the top private mortgage insurer in the market during the second quarter of 2006, as the red-hot bulk MI business began to cool off a bit, according to a new Inside Mortgage Finance ranking and analysis.Overall, the volume of new primary MI coverage increased by 3.1 percent from the first to the second quarter, with the seven private companies expanding their combined share of this business to a record 79.4 percent... Read More

MIs Gain Hope as Rating Changes Make Piggyback Mortgages Lose Some Steam in Early Part of 2006

Piggyback mortgages remain a major challenge for mortgage insurers, which have seen the com-bination products chip away at their market share the last few years as originators pitched 80-10-10s, 80-20s and other blends as a way to keep loan payments low. But the tide may be changing. Last month, Standard & Poor’s made a change to its rating criteria that places higher credit enhancement levels on first mortgages that are covered by a second... Read More

HUD to Ease Documentation Requirements on New Construction Loans to Facilitate FHA Financing

The Department of Housing and Urban Development will soon issue a mortgagee letter that will relax documentation rules for new housing construction to make it easier for lenders to offer FHA financing, according to a top agency official. Meg Burns, director of FHA single-family program development, this week confirmed that a mortgagee letter is in the works to address concerns raised by certain FHA lenders regarding the bur-densome documentation requirements for new construction financing... Read More

Consolidation and Possible Market Shock Expected to Reshape Mortgage Industry

In the next 10 years, the mortgage industry will continue to consolidate, squeezing out mid-sized players, and servicing will be increasingly important, according to a Mortgage Bankers Association task force formed to see into the future. A new report from the MBA’s Council to Shape Change suggests that a few major players will dominate the mortgage industry even further, squeezing midsized institutions out of the business through acquisitions. The group of 19 experts... Read More

Loan Repurchase Requests Appear to be Rising, Causing a Bigger Problem in a Slowing Market

Most observers say secondary market buyers are getting pickier, pushing more loans back on the seller because they don’t meet investor guidelines, but opinion is divided over whether the buyback trend will continue to accelerate as the mortgage market cools. Lenders are telling the Stratmor Group that repurchase requests are at levels “above and beyond” what the industry consulting firm would normally expect, said partner Jim Cameron... Read More

Efforts to Achieve National Predatory Lending Legislation Still on Track Despite Ney’s Decision to Leave Congress

The departure of Rep. Bob Ney, R-OH, will not cool the mortgage industry’s fervor for a national anti-predatory lending standard – at least from the point of view of major participants in the legislative process. Rep. Brad Miller, D-NC, co-sponsor of an anti-predatory lending bill modeled after his home state’s statute, said Ney’s announcement this week not to seek reelection amid a federal corruption probe will not affect efforts to achieve a comprehensive bill on subprime and predatory lending... Read More

Heady Days of GSE Growth May be Gone As Fannie, Freddie Adjust to Portfolio Caps

The days of high returns may be gone for Fannie Mae and Freddie Mac as the mortgage giants learn to adjust to life with caps on their portfolios. However, if GSE reform efforts fail and the compa-nies return to their “old ways,” that could change. Fannie and Freddie “are not going to be the massive growth companies they have been in the past,” said James Lockhart, director of the Office... Read More

Significant Share of Correspondents Finding Reasons For Not Selling Prime Conforming Loans to GSEs

The volume of prime conforming mortgages sold into the secondary market that is bypassing Fannie Mae and Freddie Mac is continuing to rise in 2006. According to the Inside Mortgage Finance MBS Database, a record-high 47.8 percent – or $141.57 billion worth – of prime loans funneled into non-agency MBS in the first half of this year carried conforming balances. Meanwhile, a new nationwide survey of correspondent lenders offers some insight into why a... Read More

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