Fannie Cuts 2018, 2019 Origination Forecast

he latest housing forecast from Fannie Mae has this year’s mortgage originations coming in $35 billion less than previously expected, while next year’s outlook was cut by $61 billion.

Economists at the secondary mortgage lender expect home lending by all U.S residential originators to amount to $386 billion during the final three months of this year.

In the first quarter of next year, originations are predicted to sink to $323 billion. But mortgage production is then expected to jump to $444 billion in the second-quarter 2019.

Source: Mortgage Daily

Mortgage Rate Forecasts Have Little Change Ahead

Thirty-year mortgage rates moved lower this past week and this past month. Short- and long-term forecasts have little movement ahead for mortgage rates.

Ellie Mae Inc.’s Origination Insight Report | September 2018 indicated that average 30-year note rates on single-family loans closed last month were 4.91 percent.

A 1-basis-point decline was recorded versus August. But compared to the same month one year previous, average 30-year rates have soared by 70 BPS.

Source: Mortgage Daily

Business, Earnings Improve at MGIC

New quarterly business was solidly higher at MGIC Investment Corp., as were earnings. Also improving was the rate of delinquency on its book of business.

From July 1 through Sept. 30 of this year, income before taxes at the Milwaukee-based mortgage insurance company was $232 million, according to third-quarter earnings data.

Results at the parent of Mortgage Guaranty Insurance Corp. were better than the same three months last year, when income came to $184 million.

Source: Mortgage Daily

US Bank Grows Mortgage Assets, Lifts Originations

U.S. Bancorp increased home lending activity and expanded the size of its residential investment portfolio. But mortgage earnings deteriorated, while servicing was reduced.

Income before income taxes during the three months ended Sept. 30 at the Minneapolis-based bank-holding company was $2.3 billion, according to its third-quarter earnings report.

Results at the parent of U.S. Bank, N.A., inched up from $2.2 billion earned in the same quarter last year and also in the preceding three-month period.

Source: Mortgage Daily

Mortgage Credit Conditions Tighten

Average credit scores increased on last month’s mortgage production, while averaged debt-to-income ratios declined. The tighter credit conditions came as refinances continued to make up a diminishing share of mortgage production.

The share of loans originated in September that were conventional transactions was 65 percent. Conventional share has thinned from 66 percent the same month in 2017.

A fifth of last month’s production was for residential loans that were insured by the Federal Housing Administration. The share was the same as 12 months previous.

Source: Mortgage Daily

Home-Equity Lending Set to Grow

A new report predicts that borrowing against home equity is poised for growth. Lenders can maximize this opportunity by personalizing marketing based on how individual consumers use these loans.

From the first quarter of 2011 until the first quarter of this year, the S&P/Case-Shiller House Price Index ascended 42 percent. Home prices now stand higher than their 2005 housing boom levels.

During that same period, growth in home-equity levels outpaced the increase in home values. Equity among U.S. homeowners — which previously peaked at $13.2 trillion in the first-quarter 2006 and hovered around $6 trillion between 2009 and 2011 — climbed to $14.4 trillion in 2017.

Source: Mortgage Daily

Mortgage Apps Drop Again, Jumbo-Conf Spread Doubles

For the second consecutive week, fewer applications were completed for home loans. As long-term mortgage rates climbed to a seven-year high, the jumbo-conforming spread doubled.

In the seven-day period that ended on Oct. 12, the volume of new retail residential loan applications completed dove a seasonally adjusted 7.1 percent from the preceding week, when activity was also lower.

The data is based on the Market Composite Index, which still moved lower by 7 percent from the week ended Oct. 5 even when no adjustments are made for seasonal factors.

Source: Mortgage Daily

Nomura Reaches $480 Million RMBS Settlement

The government and the American subsidiary of Nomura Holdings Inc. have reached a settlement over allegations the investment banker misled investors about residential mortgage-backed securities.

Nomura Holding America Inc. is accused by the Department of Justice of misleading RMBS investors in 2006 and 2007 about the quality and characteristics of securitized loans.

Nomura is accused of claiming in RMBS marketing materials that its due diligence process was "extensive," "disciplined" and "carefully developed."

Source: Mortgage Daily

GSE Mortgage Refinances Bounce Off 7-Yr Low

After plunging to the weakest level in at least seven years, government-sponsored enterprise refinance volume bounced up to the second-slowest month during the period. HARP production fell to a new low.

In August, there were 90,506 single-family loans backed by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corp. that were refinanced by primary mortgage originators.

GSE refinance activity increased from 81,982 one month previous, when the pair of secondary mortgage lenders saw the fewest refinances since at least 2011.

Source: Mortgage Daily

First Republic Bank's Mortgage Originations Tumble

A 15 percent quarter-over-quarter reduction was reported for First Republic Bank’s home-lending volume. As the servicing portfolio was reduced, residential assets expanded.

San Francisco-based First Republic revealed in its third-quarter earnings data that income before the provision for income taxes amounted to $266 billion.

Results were better than in the same three-month period last year, when it earned $242 billion. An improvement was also made from the second quarter of this year, when income was $252 billion.

Source: Mortgage Daily