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Inside Mortgage Finance

July 13, 2017

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Insured-Mortgage Business Posted Solid Gain in 2Q17, But Refi Swoon Hit Uninsured Segment

Although Fannie Mae and Freddie Mac saw a 13.1 percent drop in new single-family business during the second quarter, the flow of home loans covered by private mortgage insurance was up, according to an exclusive analysis and ranking by Inside Mortgage Finance. The two government-sponsored enterprises acquired some $57.17 billion of single-family loans with private MI coverage during the second quarter, including a small amount of modified mortgages. That represented an increase of 9.8 percent from the first quarter. But the flow of loans without MI coverage sank 18.6 percent. The key factor was...[Includes three data tables] Read More

Seneca’s End Draws Near as Company Prepares Exit From MSR Market; Pingora Slated for Sale, Yet Again

Two companies that were created earlier in the decade to buy mortgage servicing rights at rock-bottom prices are headed in different directions these days: Seneca Mortgage Servicing is exiting the business, while Pingora Loan Servicing is slated to change hands for the second time in a year. As Inside Mortgage Finance went to press this week, investment banker Houlihan Lokey was involved in direct negotiations to sell Seneca’s $53.6 billion servicing portfolio, which is considered pristine in nature. Investment banking sources said... Read More

CFPB Mortgage Servicing Rules Stabilized Market But Also Introduced Many Unintended Consequences

The mortgage servicing rules the Consumer Financial Protection Bureau promulgated in the wake of the mortgage market’s collapse brought much-needed stability to the loan servicing arena. But they also have had a host of unplanned side effects that continue to haunt the market to this day. That’s one of the prime takeaways from comments provided by some top lender/servicers and industry trade groups, in response to the CFPB’s announcement that it would begin its five-year assessment of its servicing rules as per the requirements of the Dodd-Frank Act. Wells Fargo said... Read More

CFPB Finally Issues TRID 2.0 Clarifying Final Rule, Decides to Handle the ‘Black Hole’ Separately

After a few months of delay, the Consumer Financial Protection Bureau last week issued its long-awaited final rule clarifying a number of aspects of its integrated disclosure rulemaking under the Truth in Lending Act and the Real Estate Settlement Procedures Act, otherwise known as TRID 2.0. The most noteworthy revisions relate to good faith and revised disclosures, calculating cash to close, construction-to-permanent loans, and the sharing of disclosures during the origination process. In terms of good faith and revised disclosures, the 2017 TRID rule provides... Read More

Warehouse Lenders Give Walter Another Round of ‘Waivers.’ But How Long Can the Forgiveness Last?

Walter Investment Management Corp. has secured a second round of limited waivers from its warehouse providers, a signal that its lenders are being patient – for now. According to interviews with warehouse executives and consultants, the granting of short-term waivers can be a common practice, but if those waivers go into a third or fourth round it can get expensive for the borrower and may signal an end to the patience of a company’s bankers. Walter, the parent of Ditech Financial – the nation’s 13th largest residential servicer – reported... Read More

Courts Divided on Whether Mortgage Underwriters are Exempt From Overtime After Provident Loses Appeal

An appeals court ruled in favor of mortgage underwriters last week in a dispute regarding overtime eligibility. The issue could be taken up by the Supreme Court of the U.S. as the ruling furthered a split among lower courts on the issue. Mortgage underwriters from Provident Savings Bank filed a lawsuit in 2012 against the bank after the employer said they qualified for the Fair Labor Standards Act’s administrative exemption to overtime payments. A district court ruled in favor of the bank in 2015 in the case of McKeen-Chaplin v. Provident Savings Bank. The U.S. Court of Appeals for the Ninth Circuit overturned... Read More

Groups Want to See More Tangible Activities in Fannie, Freddie Underserved Market Proposals

Some critics say the underserved markets proposals put forth by Fannie Mae and Freddie Mac don’t focus enough on increasing loan purchases. Fannie Mae and Freddie Mac in May issued draft proposals for boosting financing for certain underserved markets under the Federal Housing Finance Agency’s duty-to-serve requirements. The rule focuses on three specific markets: manufactured housing, rural housing and preserving affordable housing for low- and moderate-income households. The National Low Income Housing Coalition said... Read More

CFPB Warns of Schemes to Steal Closing Funds from Homebuyers

Scams aimed at stealing homebuyers’ closing funds persist, according to a warning last week from the Consumer Financial Protection Bureau. The warning follows similar notices in recent years from the Federal Trade Commission. “The scammers attempt to steal the homebuyer’s closing funds – for example, their downpayment and closing costs – by sending the homebuyer an email posing as the homebuyer’s real estate agent or settlement agent (title company, escrow officer or attorney),” according to Davida Farrar, counsel in the CFPB’s consumer education and engagement division. In a post on the CFPB’s website, Farrar said... Read More

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