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Shaun Donovan, secretary, Department of Housing and Urban Development
Lead Story
The Three Biggest Issues Facing Mortgage Bankers in 2010: Margins, GSEs, NPLs
By Paul Muolo
By the time you read this it will almost be 2010 with plenty to think about in terms of key issues facing mortgage banking firms in the new year. But those issues, as one might imagine, aren't much different, really, than what the industry was facing a year ago.
Then again, in December 2008 it appeared the world was about to end with the stock market in a continued freefall, corporate layoffs mounting rapidly, home prices crumbling, and Fannie Mae and Freddie Mac as newly minted wards of the federal government.
The only "positive" development a year ago was the beginning of a long, slow decline in mortgage rates — and as any housing professional knows low mortgages rates eventually lead to a boom in industry profits. That said, let's take a look at what might be the three most important issues facing residential finance professionals in the coming 12 months.
Daily Mortgage News Briefing
Last updated: December 24, 2009
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The Treasury Department will stop purchasing Fannie Mae and Freddie Mac mortgage-backed securities on Dec. 31, but the department is increasing its capital support for the two financially strapped government-sponsored enterprises.
Click here for more...The GSE regulator and the Treasury Department have approved $6 million pay packages for the chief executive officers of Fannie Mae and Freddie Mac.
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Mortgage brokers are urging the Federal Reserve Board to withdraw a proposed rule that would regulate broker compensation and delay any action until Congress finalizes pending consumer protection legislation.
Click here for more...The average rate for a 30-year fixed-rate mortgage rose above 5% during the week ended Dec. 24, according to Freddie Mac.
Click here for more...The Federal Housing Administration has tightened its guidelines on short sales so that borrowers who defaulted on their previous mortgages can't get a new FHA-insured loan.
Click here for more...Nearly 40% of homebuyers are using Federal Housing Administration financing, according to a November survey of real estate agents.
Click here for more...The production of new houses in California continued to slide in November, practically assuring that the state will record its lowest number of starts ever.
Click here for more...First Franklin Corp., the parent of Franklin Savings and Loan Co., Cincinnati, revised its earnings for the quarter ended Sept. 30.
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PMI Mortgage Insurance Co., Walnut Creek, Calif., sold its entire investment in RAM Holdings Ltd. (RAM Holdings Ltd. is the holding company for RAM Reinsurance Co. Ltd.)
Click here for more...By restructuring certain modified pool mortgage insurance policies, PMI Mortgage Insurance Co., Walnut Creek, Calif., has seen an aggregated statutory capital benefit of $51 million.
Click here for more...A bipartisan effort by members of the Senate Banking Committee to draft a financial regulatory reform bill is making progress, according to committee leaders.
Click here for more...Valley National Bancorp, Wayne, N.J., the holding company for Valley National Bank, said that it has repaid the Department of the Treasury the final 100,000 shares of Valley's Series A Preferred Stock outstanding that was held by Treasury under the Capital Purchase Program.
Click here for more...Moody's Investors Service has lowered Prime Property Fund's senior unsecured debt rating to Baa2.
Click here for more...Video of the Day
| Michael Pond, interest rate strategist at Barclays Capital, talks with Bloomberg's Scarlet Fu about the Federal Reserves purchase of Treasury notes and the impact on the yield curve. Pond also discusses the outlook for the dollar, U.S. Treasury bond auction and investment strategy. |
Mortgage Video Library
National Mortgage News presents Mortgage Focus, a video library of hot topics addressed by mortgage industry experts. Topics include servicing, government mortgage plans, refis, loan mods, technology, REO and more.
Click here for more...Editor's Choice
Post-Sale Loss Mitigation and the Effects on the REO Process
"While economists document the first tentative signs of a broad economic recovery, the current recessionary cycle and concurrent mortgage crisis continue to impact the residential real estate marketplace," says this piece in our sister publication Managing REO.
Click here to read the details.
Other Voices
This story is from our sister publication, U.S. Banker
Principal Reductions Make Better Loan Mods
One in four mortgages today is underwater, and it might get worse. According to Deloitte, nearly half of all homeowners by 2011 will owe more than their homes are worth as property values continue to spiral. These disastrous negative-equity numbers forecast a potential catastrophe for bankers and mortgage services in bringing forth more "walkaways" - people who strategically default on mortgages because the property value has sunk too far below their principal loan obligation.
It's a problem that's already caused up to 26 percent of current foreclosure activity, according to a University of Chicago economist, and could get worse as people see their neighbors skipping out and mailing in keys - often after months of rent-free living. "I'm really concerned" about walkaways, says Luigi Zingales, an economics professor studying the foreclosure crisis at UofC's Booth School of Business. "This can spread like wildfire."
Read more...Blog of the Week
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