"Rob, you have mentioned before that you are beginning to see some companies' volumes slowing down, and maybe even some lay-offs.
Is that still happening?" Yes it is. Established lenders, even those
adding production units, are looking at their historical purchase
volumes and forecasting things for the 2nd
half of 2014. The longer rates stay here or go up, the more refinances
will drop, and practically every lender sees a marked decline in
purchase volumes during the autumn and winter. Companies are moving
toward a variable cost structure, and yes, unfortunately layoffs can be
part of the equation - the latest example being RoundPoint Mortgage eliminating 166 jobs.
And Zillow might buy Trulia? That would cause quite a stir...
Do you think GSE reform is still a possibility?
Snort. Congress currently has a 15% job approval rating, and of the 535
members of Congress (100 senators and 435 elected officials in the
House of Representatives), 468 members (or 87% of Congress) are up for
re-election on 11/04/14. With the August recess, and October campaigning
where incumbents will try to convince us that it is everyone else's
fault, and then the lame duck period heading into the Holidays, it
doesn't leave politicians much time for action. So we can all look to
the MBA, the FHFA, the CFPB, and others to help chart mortgage policy
Congress won't act, we can continue to watch the FHFA (and thus Freddie
and Fannie) and GNMA take matters into their own hands. So it is no surprise to see Ginnie
Mae set to launch Electronic Issuer Application Process -- Government
Corporation Brings Transparency to the Application System
"We want to do everything that we can to ensure that our process is
smooth, efficient and responsive for all parties," said Ginnie Mae
President Ted Tozer. "This includes creating a more efficient
application process, becoming more responsive to applicant concerns and
helping prospective Issuers clearly understand our issuer eligibility
criteria and what it means to become a participant in our program."
"This new process, which will also allow applicants to check their
application status online, will make the process more transparent," Ted
Tozer said. Beginning September 1, 2014, applicants will be required to
file applications for Ginnie Mae Issuer approval electronically via
Ginnie Mae's new Application Connection.
originators have gone through the process of becoming a GNMA issuer. It
can be long and tedious obtaining the sometimes hundreds of pages which
fulfill the application's checklist. The final obstacle in the process
has always been to print up the application, overnight it, and then
cross your fingers and hope that it doesn't end up in the hands of
delivery guys who's been featured on YouTube throwing someone's flat
screen TV over a fence. I was pleased to read that GNMA is blasting into
the late half of the 20th century with this release. "Ginnie
Mae announced today that it is moving from a paper-based Issuer
application process to an electronic system. Beginning September 1,
2014, applicants will be required to file applications for Ginnie Mae
Issuer approval electronically via Ginnie Mae's new Application
Connection. The new Application Connection, which will be located on
Ginnie Mae's website,
will be available starting September 1. Due to the transition from a
paper-based to an electronic application process, Ginnie Mae will not
accept paper-based (hard copy) applications after July 31, 2014."
And Ginnie revised its MBS Issuer eligibility requirements. "Ginnie
Mae has also revised its minimum net worth requirements for applicants
who wish to participate in multiple Ginnie Mae program types
(single-family, multifamily, home equity conversion mortgages (HMBS),
and/or Title I manufactured home loan-backed securities). Beginning
September 1, 2014 and thereafter, applicants seeking Ginnie Mae approval
to participate in multiple program types will be required
to have an adjusted net worth equal to or greater than the sum of the
minimum net worth requirements for each program type in which the
applicant intends to participate.
For example, an applicant seeking approval to participate in both the
single-family and HMBS programs must have an adjusted net worth of at
Speaking of government programs, the MBA filed a comment letter with FHA on the Homeowners Armed with Knowledge (HAWK) housing counseling program,
which would provide first-time homebuyers who receive HUD-certified
counseling with FHA mortgage insurance premium (MIP) reductions. MBA
believes that the current FHA premium structure is pricing many
otherwise qualified borrowers out of the market, and in its comments MBA
congratulated FHA for its initiative with HAWK, but suggested that the
program be restructured to offer borrowers greater material reductions
in their monthly payments by shifting proposed reductions in the upfront
MIP to the annual MIP. MBA's comment also expressed concern with
several other aspects of the FHA proposal, including its requiring of
lenders to bear the cost of some portions of the counseling, the utility
of post-closing counseling, and the limiting of the initial phase of
the HAWK program to lenders and servicers selected by FHA.
Fannie Mae released the inaugural results of its quarterly Mortgage Lender Sentiment Survey. This
new industry research initiative tracks insights into current lending
activities and market expectations among senior mortgage executives at
Fannie Mae's lending institution partners. Results collected during the
first two quarters of 2014 show greater consumer mortgage demand in the
second quarter of the year, a steady and positive near-term mortgage
demand outlook, and divergence between larger and smaller lenders in
underwriting credit standards.
Fannie Mae announcement
SVC-2014-11: Servicer Compliance with Anti-Money Laundering Provisions
of the Bank Secrecy Act. Fannie Mae is defined as a "financial
institution" under the Bank Secrecy Act and must implement a formal
anti-money laundering program. This Announcement describes the steps
servicers must take no later than Aug. 25 to comply with these new
SVC-2014-12: Neighborhood Stabilization Initiative -- MyCity
Modification for Detroit, Michigan, Fannie Mae is introducing a mortgage
loan modification program for Detroit, Michigan -- MyCity Modification.
This program is part of the Neighborhood Stabilization Initiative
recently announced by the Federal Housing Finance Agency and jointly
developed by Fannie Mae and Freddie Mac. The MyCity Modification targets
borrowers whose mortgage loans are secured by properties within the
City of Detroit and who meet specific eligibility requirements: 2014-12.
announcements include SEL-2014-05: Lender Selling Representations and
Warranties Framework Updates, Fannie Mae introduced an alternative to
repurchase for certain mortgage loans for which the mortgage insurance
has been rescinded, known as an "MI stand-in". The announcement
describes the process the servicer (or the responsible party) must
follow to be considered for an MI stand-in. To view this announcement: svc1413.
Additionally, Fannie announced changes to Servicing Reports in Message
Manager. Fannie Mae plans to add the following servicing reports,
currently emailed to applicable servicers by Fannie Mae Exceptions
Transactions Management or Investor Reporting analysts, to the servicing
report distribution in Message Manager effective July 30 and 31: The
Loan Read Detail Report (LRDR) The Service members Civil Relief Act
(SCRA) Cash Report. To view the information: Servicing Report.
As part of its enhancements to make the Freddie Mac selling system easier to use, it is updating the following on July 28: adding Freddie Mac Loan Number Search Capability.
for your existing loan data with your Freddie Mac loan number. This new
feature is in response to your feedback and gives you another method to
search for your loan data in addition to the existing Seller Loan
Identifier search capability. The search by Freddie Mac loan number
option is available from the selling system home page and from the basic
and advanced search tabs on the pipeline search screens. Expanding
Selling System Online Help Features
answers quickly with our enhanced online help to questions you may have
when entering loan data into the selling system. Updates include:
Detailed content explaining all aspects of the selling system's
functionality, improved Table of Contents for easier navigation, new
search capability, and short video clips that walk you through common
selling system topics. To access, click on the "help" tab at the top of
the selling system home page. For more information: Contact 800-FREDDIE
and select Option 3.
July 13 Freddie Mac and Fannie Mae (the GSEs) made the following
updates in the Uniform Collateral Data Portal® (UCDP®): Changes to
Accepted MISMO XML File Formats in the UCDP - The GSEs will only accept
the MISMO standard XML file format in the UCDP. The UCDP will no longer
accept appraisals submitted in PDF, ACI XML, and AIReady file formats.
Implementation of Third Phase of UCDP Conversion of Warning to Fatal UAD
Edits - The third phase of the conversion of current Uniform Appraisal
Dataset (UAD) compliance warning edits to fatal UAD edits will be
implemented in the UCDP. Refer to the release information UCDP Release Information for additional details on the UCDP July 13 release and other important updates.
Freddie Mac has video help! Check out Freddie's new Quick Tips for Single Family video to see how you can quickly and easily identify and track changes in the Single-Family Seller/Servicer Guide (Guide). The video walks you through our Guide features on AllRegs®, including
titles in the table of contents to indicate where changes were made in
the past 60 days, Green text to show recent additions in the Guide
language, Quick access to recently published Guide Bulletins impacting a
section, exhibit or form in the Guide, The "Inline Revision History"
feature which helps you review future or past requirements and The video
also highlights the Historical Guide Snapshots on FreddieMac.com, which
is a convenient way to review archived Guide requirements.
Fannie Mae bulletin SEL 2014-07 outlines
new flexibilities for financing HomePath® properties, allowing the
Federal Home Loan Banks as grant and Community Seconds providers,
incorporation of Announcement SEL-2014-05, and changes to the high-cost
areas for MyCommunityMortgage loans as a result of the 2014 area median
incomes. Refer to HomePath Fact Sheet.
FHFA has issued a public "Request for Input" regarding Fannie Mae and
Freddie Mac's revised Private Mortgage Insurer Eligibility Requirements
(PMIERs). Refer to FHFA's announcement and Fannie Mae's statement of support for more information.
Bulletin SEL 2014-08
discusses Approved Mortgage Insurance Forms. Fannie Mae has worked with
approved mortgage insurance companies to update their master primary
policies and related endorsements and other forms (Forms). Any mortgage
loan sold to or securitized by Fannie Mae that requires primary mortgage
insurance (or that has primary mortgage insurance) and has a loan
application date on or after Oct. 1 must be insured under one of the
approved forms. Lenders also become responsible for ensuring that only
Fannie Mae-approved forms are used in connection with such loans.
spite of the news, domestic or international, rates continue to stay in
a narrow range. But those in lending and real estate did not receive
good news yesterday as we saw some disappointing new home sales data.
June sales were down 8.1% to 406K while May was revised down to show a
gain of 8.3% vs. the prior estimate of 18.6% increase. The big swing was
concentrated in the Northeast, but the South also saw a sizable drop in
June (-9.5%) after a rise of 3.1% in May. We also had an outsized
decline in single family starts in the South in June. Inventory has
edged higher, bringing months supply to 5.8, which is elevated relative
to recent history.
But for jobs, Jobless Claims unexpectedly dropped to an 8-year low falling by 19,000 to 284,000 in the week ended July 19. The
four-week average of jobless claims, considered a less volatile measure
than the weekly figure, decreased to 302,000, the lowest since May
2007. This jobs number is what the bond market keyed off and it led to a
modest sell-off with the 10-year Treasury note losing .375 in price and
closing at a yield of 2.51%. Agency MBS prices followed along for the
ride in spite of the Fed buying nearly $2 billion a day.
morning we've already seen the only piece of schedules news, and that
is the volatile Durable Goods number. It was expected at +0.5% (from
last month's -1.0%) and came out at +.7%. Prior to the number rates were
unchanged; soon after they are slightly lower at 2.49% and agency MBS prices better by about .125.