Although Bismarck, ND is a fine city, it did not make Zillow's Best Places to Buy a Vacation Home
list. I read many articles during the course of the week but this one
is pretty interesting and managed to capture my attention away from
Tetris for a while. Zillow created an index, known as the Second Home Index (SHI)
in order to surface U.S. cities near popular vacation destinations that
are also good locations to buy a second home for seasonal use. This is
an interesting index, one which may have merit, as they identified
vacation cities near popular destinations, then ordered those cities
according to their investment and rental income potential. Spoiler
Alert: homes in a number of prices ranges, within five miles of a golf
course, appear to only be located in Florida. Go figure. How about this
for the opposite of McMansions in the suburbs?
Will a new HARP ride in and save the refinance business?
Probably not, as borrowers seem kind of "tapped out" on the program,
but the public relations efforts have been renewed. This week FHFA
Director Watt spoke at a town hall meeting in Chicago to publicize the
Home Affordable Refinance Program (HARP). The FHFA estimates that as of
the end of 2013 there were roughly 676,000 loans still eligible for HARP
refinancing. Notably, Director Watt did not use this event to announce
an extension of the HARP's current expiration date. Following the event,
Director Watt was asked about the extension issue and stated: "It's not
even something that I'm looking at right now because we are in 2014 and
the existing HARP program doesn't end until the end of December 2015."
many know, reverse mortgages are available to homeowners 62 years old
and older with significant home equity. They are designed to enable
retirees to borrow against the equity in their homes without having to
make monthly payments as is required with a traditional "forward"
mortgage or home equity loan. Under a reverse mortgage, funds are
advanced to the borrower and interest accrues, but the outstanding
balance is not due until the last borrower leaves the home, sells, or
passes away. Borrowers may draw down funds as a lump sum at loan
origination, establish a line of credit or request fixed monthly
payments for as long as they continue to live in the home. According to the National Reverse Mortgage Lenders Association, senior home equity has reached $3.60 Trillion
(its highest level since 1Q'08) and there are currently more than
575,000 senior households using a reverse mortgage to help meet their
financial needs...it's also estimated that there are at least 575,000
children who may be surprised when the will is eventually read.
Huh? We're being told now that last year Nationstar was restricted by adding Fannie & Freddie servicing? I'm always the last to hear...
So you're in the market for a little servicing, uh? Well here ya go...MIAC has two offerings; the first a $3 Billion FNMA/GNMA mortgage servicing portfolio.
The portfolio is being offered by a mortgage company that originates
loans with a national geographic concentration. The Seller will be
providing full reps and warrants for the package: $170,406 Average Loan
Size, 95% fixed and 5% hybrid loans, 14% Fannie A/A, 33% Fannie MBS, 18%
GNMA I and, 35.14% GNMA II loans; Weighted average interest rate of
4.254%, 21% retail and 79% wholesale, with bids due by July 14th...the
second, a $50 Million per month concurrent flow mortgage servicing offering.
The flow servicing is being offered by a "well-capitalized" bank that
originates nationally. The seller will be providing full reps and
warrants for offering: $245k average loan size, 100% fixed rate loans,
GNMA - 53.94%, FNMA A/A - 42.66%, Freddie ARC- 3.40%, 100% retail,
national state distribution, and average FICO score of 752, with bids
The only two sure things in life are death and taxes, right? The CFPB issued an interpretive rule to clarify that "when a borrower dies,
the name of the borrower's heir generally may be added to the mortgage
without triggering the Ability-to-Repay rule. This clarification will
help surviving family members who acquire title to a property to take
over their loved one's mortgage and to be considered for a loan workout,
if necessary, to keep their home.
For some quick investor & agency news...
As a reminder, on June 18th, Freddie
introduced the Freddie Mac MyCity Modification, a temporary offering
within the city of Detroit, Michigan, to assist struggling homeowners by
providing a loan modification option that may offer significant payment
relief. The goal is to help provide eligible borrowers with more
affordable terms so they can stay in their homes. Only Servicers with
loans in the eligible Detroit ZIP codes, or those who may acquire
servicing of applicable loans in those ZIP codes in the near future,
will be impacted by the requirements described in Guide Bulletin
2014-11, related to the MyCity Modification. These specific ZIP codes
are listed in today's Guide Bulletin. Servicers must follow the MyCity
Modification guidelines and submit their recommendations for borrowers
on and after September 1, 2014. For complete information: Bulletin 2014-11.
Mortgage Master, Inc.
announced it has become the first non-depository lender to join the
Massachusetts Home Ownership Compact to provide affordable mortgage
solutions to lower income first-time home buyers. As a signatory of the
Home Ownership Compact, Mortgage Master has committed to make a good
faith effort to provide Mass Housing mortgage loans to borrowers below
the median household income in 2014.
Cole Taylor Mortgage
announced its offering of LPMI High Balance Fixed Products: 30-year
fixed, 20-year fixed and 15-year fixed. The current rate sheet reflects
the applicable rate adjustment and is effective for all loans locked on
or after June 16th.
ABA Community Bank Mortgage LLC has selected First Community Mortgage (FCM) as a secondary market investor.
With this selection, ABA Community Bank Mortgage LLC owner banks can
sell agency-eligible loans on a servicing-released basis to FCM and
access their full line of products.
And it has also selected Five Oaks Investment Corporation as its newest secondary market investor,
a move that will allow owner banks to sell non-conforming jumbo loans
on a servicing-released or servicing-retained basis to Five Oaks and
access their full line of fixed rate and ARM products. Five Oaks is also
announcing a private label servicing solution for owner banks.
("Co-owned by the Corporation for American Banking, an ABA subsidiary,
and community banks, the ABA Community Bank Mortgage LLC leverages the
power of joint ownership for better execution on loans sold into the
secondary market. By aggregating volume, the LLC is able to leverage the quality and total volume of the owner banks' loan production.")
product bulletin 2014-019 includes expanded FHA 203K debt-to-income
ratios, SONYMA income limit changes effective with registrations on
6/18/14 and Agency 2nds revisions. Contact your Account Executive for
questions regarding these changes.
Bayview Correspondent Lending has updated its Non-QM Portfolio Products.
The summary includes **Standard loan amounts up to $1,500,000,
Non-Warrantable Condos to 70% LTV on Primary Residences. Primary
Residence, Second Homes and Non-Owner Occupied properties
Family Attached/Detached, condominiums, Planned Unit Developments,
Leaseholds and standard agency Rural Properties: Maximum 80%
loan-to-value (LTV) on all products (LTV reductions may apply for Second
homes, Investment properties and jumbo loan sizes).
Fifth Third has
clarified eligibility and asset requirements on all Fannie Mae
products. These clarifications include but are not limited to the
following: delayed financing, continuity of obligation and multiple
financed propertied for the same borrower. Asset requirement including
business assets, life insurance funds, and VOD requirements are also
updated. Contact your Sales Representative for complete update
For the month of June, Angel Oak Funding Wholesale
set another record in production and "continues to execute on its plan
to aggressively grow its non-Agency/non-QM business. With a footprint
primarily in the southeastern U.S., CA and TX, the company continues to
deliver on its commitment to bring make-sense lending back to the
Penny Mac is aligning with recent Freddie Mac changes as outlined in Freddie's 14-12 bulletin in its announcement 14-36. These changes include large deposits, monthly debt payment-to-income ratio requirement, Open Access and Power of Attorney. Penny Mac announcement 14-35
aligns to Fannie Mae's recent updates regarding Cash-out transactions,
Continuity of obligation, multiple financed properties, POA, and other
Asset Policies. Announcement 14-34 from Penny Mac discusses availability of employment beginning after close allowed on conforming LP loans. To view these Penny Mac announcements, visit: gopennymac or contact your representative for complete details.
markets did not do much yesterday, but overnight saw quite a move.
Wednesday morning was quiet, but we saw some movement after a weak 10-yr
T-note auction ("lukewarm demand as the issue tailed by 1.2bps at
2.597%. Stats were weak with 39.6% awarded to indirects, 13.9% directs
and a 2.57 bid to cover"). We also had the minutes from the June Fed
meeting, indicating that the final QE taper will be $15Bln in October if
the economic outlook holds. And of great interest is that discussions
are still occurring as to what/how tools will be used to raise rates. So
as expected, the FOMC minutes included discussion on the Fed's exit
strategy and there is support for continuing reinvestment purchases past
the first rate hike. "Many participants agreed that ending
reinvestments at or after the time of liftoff would be best, with most
of these participants preferring to end them after liftoff."
That is yesterday's news. In the early going we're seeing a nice rally/improvement in rates.
There are a host of "reasons" but this all still feels like a bout of
consolidation/digestion in an environment of very thin liquidity and no
news. Sentiment began deteriorating earlier in the week although the
fundamental landscape hasn't shifted much. There were a few "negative"
headlines (China's exports were a touch below estimates, industrial
production in France & Italy were light, Portugal worries continue
to reverberate through Europe, Japan machinery orders plunged, etc.).
in the U.S. we've seen Initial Claims (expected at +312k from +315k, it
was -11k to 304k, with the 4-week moving average -3,500). The Treasury
concludes its latest round of coupon auctions with $13 billion reopened
30-year bonds at 1PM EST. In
the early going the 10-yr. is better by .5 and down to a yield of 2.50%
after closing Wednesday at 2.55%, and agency MBS prices are better by