Ginnie Mae

Although forbearance exits are not yet complete, two arms of the Department of Housing and Urban Development have decided to make some temporary pandemic relief programs permanent.

HUD official Alanna McCargo takes over the top job at the government corporation, which has had a series of acting leaders since 2017.

While overall volume was down in August, it remained historically strong, particularly in the securitized market for home equity withdrawal loans made to borrowers age 62 and up.

The biggest issues facing the mortgage industry involve public policy and all of them feature a political narrative that is ill-informed and largely at odds with market realities, Whalen writes.

Financial institutions will have until early October to weigh in about new risk-based capital requirements for nonbanks.

The guarantor of mortgage-backed securities has been without a Senate-confirmed president for four and a half years. The vacancy makes it difficult for other government agencies to coordinate housing objectives, according to stakeholders.

In assuming that credit unions have the same risk profile as nonbank lenders, the mortgage insurer is now threatening to exclude nearly a quarter of them from being qualified issuers of the securities it backs, writes the Senior Director Of Advocacy and Counsel at the Credit Union National Association.

The proposal should be withdrawn or reworked around the needs of small players they impose a disproportionate burden on, the Community Home Lenders Association said.

The guarantor has for the first time proposed a risk-based capital requirement for companies not subject to other federal regulation. The industry says the plan, which would impose a heavy charge for servicing portfolios, could drive lenders away from government-backed programs.

The Mortgage Bankers Association is advocating for more funding for the agency due to its elevated securitization activity, and counterparty risk linked to a lingering concentration of loans in forbearance.

Ginnie Mae is allowing lenders to securitize modified home loans with this extended term as the Biden administration works to make more housing options available for struggling borrowers.

While cash-out refinances were a “significant driver” of risky loans leading to the Great Recession, those mortgages pose less of a threat due to tighter underwriting standards, according to Milliman.

The Federal Housing Finance Agency's recent allowance of a 3-month extension of CARES Act forbearances stands to upend the trend in plan exits.

The volume of Ginnie securities issued in December marked the first time more than $80 billion has been issued in a month.

The deadline for inclusion in Ginnie mortgage-backed securities has been extended and an exception will be made for some participations.

Whether Ginnie issuance increases in the future may depend in part on the extent to which the Biden administration wishes to tap the FHA to promote affordable housing and homeownership.

Troubled Veteran’s Administration “no-bid” loans could bankrupt servicers in the near future, says Morgan Snyder of CAllc Research Publications.

Even government-sponsored enterprise loans, which have seen forbearance rates drop for 24 weeks in a row, saw a slight uptick.

Rates could be 50 basis points steeper than the MBA’s current projections, which anticipate the 30-year mortgage will average 3.3% next year, up from nearly 3% this year.

When new lending volumes start to recede, even with the FOMC’s actions, the shoals of credit and operational risk lurking just beneath the surface will emerge, columnist and analyst Chris Whalen says.