FHA Delinquencies Plummeted in Q3

Posted To: MND NewsWire

FHA loans posted a substantial decline in delinquencies during the third quarter, leading an overall improvement in loan performance. The Mortgage Bankers Association said its National Delinquency Survey found the non-current rate for mortgage loans on one-to-four- unit residential properties was 3.97 percent. This was 56 basis points (bps) below the rate in the second quarter and 50 bps lower compared to the third quarter of 2018. Foreclosure starts were also down 4 bps to 0.21 percent of all mortgage loans. Marina Walsh, MBA’s Vice President of Industry Analysis, said “Mortgage delinquencies decreased in the third quarter across all loan types – conventional, VA, and in particular, FHA. The FHA delinquency rate dropped 100 basis points , as weather-related disruptions from the spring waned…(read more)

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Source: Mortgage News Daily

MBS Week Ahead: Trade Headlines and Technicals (With a Side of Data)

Posted To: MBS Commentary

Last week provided a much-needed recovery that counteracted some of the fast-paced selling seen in the first week of November. Despite the friendly direction of the move, the pace and fervor left something to be desired –at least for those hoping to see clear confirmation that traders were thrilled to buy bonds when 10yr yields approached 2%. To be fair though, one could argue that traders were at least somewhat enthusiastic about that, even if they weren't downright thrilled. The combination of solid support and the absence of fervor reinforces a range-bound theme heading into the end of the year. Major updates on the trade deal can provide plenty of volatility inside a range while actual progress could certainly prompt a breakout from the trend. Gauging the opposite of progress is a…(read more)

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Source: Mortgage News Daily

CFPB Lightens Requirements for Temporary LO License

Posted To: MND NewsWire

The Consumer Financial Protection Bureau (CFPB) has issued an Interpretive Rule for one type of loan originator licensing. The Secure and Fair Enforcement for Mortgage Licensing Act (SAFE ACT) of 2008 established a national system for licensing and registration of loan originators which envisioned two categories of licensing, one for originators working for state-licensed mortgage companies and those working for federally regulated financial institutions. Subsequently, Regulation Z which interprets the Truth in Lending Act (TILA), established a third category of originators, those with temporary origination authority. These rules apply to individuals who were previously registered or licensed, are employed by a state-licensed mortgage company, are applying for a new state loan originator license…(read more)

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Source: Mortgage News Daily

Licensing, Loan Data, Non-QM Products; Customer Service Survey; No Fed Move 'til April?

Posted To: Pipeline Press

Do you dread “Smonday?” (That’s when Sunday stops feeling like a Sunday, and the anxiety of Monday kicks in.) Here is something to dread. All this talk about MLOs losing their jobs to automation, or real estate agents losing their job to internet options. Automation, algorithms, and artificial intelligence have already reduced the amount of human labor in specialty manufacturing, warehouse parcel delivery and resume screening. A new report from analysts at Bank of America Merrill Lynch estimates the rise of automation could make up to 800 million jobs (nearly half of all jobs worldwide) obsolete by 2035. Guess we’ll all sit around playing Sudoku and selling Hot Wheels or Matchbox sets back and forth on eBay. Seriously, the personal touch is critical in lending. I guess…(read more)

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Source: Mortgage News Daily

MBS RECAP: Bonds Level Off Without Committing to Reentry

Posted To: MBS Commentary

Yields broke up and out of their prevailing range last week and took the present week to focus on reentry. While those efforts went a long way toward defusing concern over how quickly rates were moving higher, they fell short of offering much reassurance about where they're going next. In other words, rates did only as much as they had to do in order to unwind last week's more abrupt spikes. They made no promises for anything more. Today, specifically, was the least eventful day of the week despite boasting the biggest economic report. It didn't help that Retail Sales came in very close to consensus and with fairly well mixed internal components. Next week has a more robust line-up of econ data, but it doesn't get interesting until the end. Beyond that, trade-related headlines…(read more)

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Source: Mortgage News Daily

Much Better Week For Rates, But Bigger Picture Risks Remain

Posted To: Mortgage Rate Watch

Mortgage rates finished the week in much better territory compared to last Friday. Today only added modestly to that move, but the simple act of moving in a friendly direction feels like a major victory after coming toe to toe with the highest rates in more than 3 months (last week). There weren’t any obvious reasons for today’s meager gains. In fact, the underlying bond market was slightly weaker on the day (which usually implies higher rates). But lenders were still getting caught up with the week’s previous bond market gains and thus managed to overlook the contrary cues from the market. In the slightly bigger picture, this week can be seen as the bond market’s way of saying it’s not quite ready yet to embark on a panicked race back toward higher rates . The question remains: is that sort…(read more)

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Source: Mortgage News Daily

Home Equity, Budgeting Tools; Extensive Reports on Rise of Non-Bank Lending

Posted To: Pipeline Press

This week I’ve been running football quotes in the joke section at the bottom. Thanks to Gary B. who sent Chuck Noll’s, “Pressure is something you feel when you don’t know what you’re doing.” Lots of folks in our industry, including me, don’t know what they’re doing in terms of technology. Nor does the consumer. “Rob, here’s a question for your readers. I’m reading articles about Facebook secretly using the user’s iPhone camera as you scroll your feed . If a loan officer has Facebook on their phone, and receives loan applications through an app or other means on their iPhone, how does a mortgage company QC the security of consumer information? Signed: Make paper great again!” Regarding consumers, how about two who, gosh darn…(read more)

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Source: Mortgage News Daily

MBS Day Ahead: Retail Sales in Focus; Trade Headlines Always a Risk

Posted To: MBS Commentary

It's Friday and that means it's time to be on the lookout for unexpected trade-related headlines, especially in the afternoon. Those sorts of newswires and tweets have become almost predictable at the end of any given week, but markets have increasingly taken them with a grain of salt. Case in point, last week's major motivation for stock gains and bond market weakness was the notion that previously announced tariffs would be rolled back as a part of the phase 1 trade deal. The biggest move followed an announcement to that effect from China's commerce minister. But when Trump pushed back on those headlines on Friday, it did little to undo what had already been done (though it definitely moved markets). Before we get to the point in the day where such headlines become a bigger…(read more)

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Source: Mortgage News Daily

What Exactly is "Mass Timber" and Why Should We Care?

Posted To: MND NewsWire

Look closely and you will see that a lack of new home construction is behind almost every problem facing housing today. Residential construction has simply not recovered from the financial crisis and the experts see it only growing worse. Freddie Mac’s economists estimated the long-term shortfall between the supply of homes and the demand could be 2.5 to 4.0 million units each year. The National Association of Homebuilders’ (NAHB’s) Paul Emrath says since 2006 builders have never matched the average of 1.5 million homes they built each year from 1961 to 2000. While there are many reasons builders aren’t building, two of them are the costs of construction making it risky for builders to assume they can make a profit, and the lack of appropriate skilled labor . One type of building that is attracting…(read more)

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Source: Mortgage News Daily

Continued Deterioration in Origination Quality

As home lenders and investors have recently been a little more relaxed about credit qualifications compared to just after the crisis, mortgage quality has weakened. Still, quality is better than before the crisis.

During the past three years, the quality of residential loans originated has weakened, though credit quality remains far stronger than the early 2000s and the late 1990s.

Components of borrower character like credit scores are the strongest feature of current mortgage originations, and they have weakened little over the past few years.


Source: Mortgage Daily