Trump commutes sentence for Lend America exec, Biden administration ramps up and more of the week's top news
January 22, 2021 10:01 AM
Stefani Reynolds/Bloomberg
Trump commutes sentence for Lend America exec Michael Ashley
Convicted mortgage fraudster Michael Ashley had his sentence commuted by President Trump on his final day in office, meaning he will never serve a day in prison for his crimes.
The former executive at now-shuttered mortgage firm Lend America pleaded guilty toa single count of a bank fraud in 2011. He then became a cooperating witness for the government and wasn't sentenced until 2019.
(Read the full storyhere .)
The former executive at now-shuttered mortgage firm Lend America pleaded guilty to
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Bank of America’s 4Q mortgage volume slips
Although Bank of America bucked market expectations by originating more mortgages on a quarter-to-quarter basis in the fourth quarter, the bank saw a significant drop-off in volume on a year-over-year basis.
The Charlotte, N.C.-based bank reported fourth-quarter volume of $13.7 billion, compared with $13.4 billion in the third quarter, but down from $22.1 billion for the fourth quarter of 2019.
For the industry as a whole, Fannie Mae expected fourth-quarter production to be down nearly 7% from the third quarter, to $1.24 trillion from $1.32 trillion.
(Read full storyhere .)
The Charlotte, N.C.-based bank reported fourth-quarter volume of $13.7 billion, compared with $13.4 billion in the third quarter, but down from $22.1 billion for the fourth quarter of 2019.
For the industry as a whole, Fannie Mae expected fourth-quarter production to be down nearly 7% from the third quarter, to $1.24 trillion from $1.32 trillion.
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Andrew Harrer/Bloomberg
FHA updates policy to affirm that DACA recipients are eligible for loan
The Federal Housing Administration shortly before Wednesday’s inauguration issued an informational bulletin that gives Deferred Action for Childhood Arrivals recipients with U.S. work permits access to loans it insures.
Previously, Len Wolfson, assistant secretary of the Department of Housing and Urban Development under the Trump administration, said in 2019 the “non-citizens” language in the FHA’s handbookmade DACA recipients ineligible for FHA loans .
HUD said this week’s change was made because “the term ‘lawful residency’ predates DACA and thus did not anticipate a situation in which a borrower might not have entered the country legally, but nevertheless be considered lawfully present.”
(Read full storyhere .)
Previously, Len Wolfson, assistant secretary of the Department of Housing and Urban Development under the Trump administration, said in 2019 the “non-citizens” language in the FHA’s handbook
HUD said this week’s change was made because “the term ‘lawful residency’ predates DACA and thus did not anticipate a situation in which a borrower might not have entered the country legally, but nevertheless be considered lawfully present.”
(Read full story
Andrew Harrer/Bloomberg
CFPB’s Kraninger resigns just as Biden takes office
Consumer Financial Protection Bureau Director Kathy Kraninger resigned Wednesday, clearing the way for the Biden administration to pick a successor.
Kraninger's departure from the agency with the change of power in Washington was widely expected. Though her term would not have officially ended until 2023, many of her policies supported by the Trump administration had roiled Democrats.
(Read full storyhere .)
Kraninger's departure from the agency with the change of power in Washington was widely expected. Though her term would not have officially ended until 2023, many of her policies supported by the Trump administration had roiled Democrats.
(Read full story
Alex Edelman/Bloomberg
Biden nominates Rohit Chopra as head of CFPB
Rohit Chopra, President Biden’s choice to head the Consumer Financial Protection Bureau, is expected to hit the ground running at the CFPB by quickly undoing Trump administration policies and moving aggressively to protect consumers during the pandemic.
Chopra is seen as a strong consumer advocate who will push for fairness and financial inclusion for minorities, one of the Biden administration’s priorities.
"Rohit is a dynamic leader who knows the agency, understands the issues and will be ready to set a new course on day one," said Michael Gordon, a partner at Bradley Arant Boult Cummings.
(Read the full storyhere .)
Chopra is seen as a strong consumer advocate who will push for fairness and financial inclusion for minorities, one of the Biden administration’s priorities.
"Rohit is a dynamic leader who knows the agency, understands the issues and will be ready to set a new course on day one," said Michael Gordon, a partner at Bradley Arant Boult Cummings.
(Read the full story
Prime jumbo mortgage lending by nonbanks set to grow in 2021
The prime jumbo mortgage business is likely to benefit from the Consumer Financial Protection Bureau's recent revisions to the Qualified Mortgage and Ability-to-Repay rules , which loosen certain standards established after the financial crisis.
With home prices inching up, the market for larger mortgages could likewise expand. In 312 U.S. cities, the typical value of a home is now over $1 million, most of them clustered around nine East and West Coast metro areas. That's a net gain of 45 cities in the last year, according to Zillow. Back in 2015, there were only 208 that met this criteria.
(Read the full storyhere .)
With home prices inching up, the market for larger mortgages could likewise expand. In 312 U.S. cities, the typical value of a home is now over $1 million, most of them clustered around nine East and West Coast metro areas. That's a net gain of 45 cities in the last year, according to Zillow. Back in 2015, there were only 208 that met this criteria.
(Read the full story
Andrew Harrer/Bloomberg
FHFA extends foreclosure ban as borrower struggles persist, costs rise
Fannie Mae and Freddie Mac have extended their foreclosure and eviction moratoriums to the end of February, according to the Federal Housing Finance Agency.
The extension of the government-sponsored enterprises’ bans from Jan. 31 to Feb. 28 gives the incoming Biden administration more time in which to consider how it wants to contend with the concern.
(Read full storyhere .)
The extension of the government-sponsored enterprises’ bans from Jan. 31 to Feb. 28 gives the incoming Biden administration more time in which to consider how it wants to contend with the concern.
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Flagstar's 4Q earnings slip as mortgage records a lower gain on sale
The fourth quarter was the second-best ever for earnings at Flagstar Bancorp, but its mortgage business had lower revenue compared with the prior period as gain-on-sale margins dropped.
Flagstar reported net income of $154 million for the fourth quarter, compared with its best-ever $222 million in the third quarter and $58 million forthe fourth quarter of 2019.
Even with the lower revenue, the three aspects of the mortgage business Flagstar participates in — originations, servicing and providing warehouse credit — were bright spots in the fourth quarter.
(Read the full storyhere .)
Flagstar reported net income of $154 million for the fourth quarter, compared with its best-ever $222 million in the third quarter and $58 million for
Even with the lower revenue, the three aspects of the mortgage business Flagstar participates in — originations, servicing and providing warehouse credit — were bright spots in the fourth quarter.
(Read the full story
Mortgage applications decrease as rising rates temper refi volume
Mortgage applications decreased 1.9% from one week earlier as rising rates started to affect refinance activity, according to the Mortgage Bankers Association.
Still, refinancings predominate the market. The MBA’s Weekly Mortgage Applications Survey for the week ending Jan. 15 found that while the refinance index decreased 5%from the previous week , it was 87% higher than the same week one year ago. The refinance share of mortgage activity decreased to 72.3% of total applications from 74.8% the previous week.
(Read full storyhere .)
Still, refinancings predominate the market. The MBA’s Weekly Mortgage Applications Survey for the week ending Jan. 15 found that while the refinance index decreased 5%
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GSE multifamily hits record in 2020
Freddie Mac on Wednesday joined fellow government-sponsored enterprise Fannie Mae in reporting record multifamily mortgage volume in 2020 that neither would be able to top this year if current caps stay in place.
The $82.5 billion in loans Freddie purchased and $76 billion Fannie bought last yearexceed the $70 billion caps each GSE set for 2021. In a five-quarter period ending in 2020, multifamily mortgage purchases were capped at $100 billion or an annualized $80 billion for each.
(Read the full storyhere .)
The $82.5 billion in loans Freddie purchased and $76 billion Fannie bought last year
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Lenders prepare for the refi boom's aftermath
Heading into 2021, mortgage companies had to navigate an irregular landscape when setting their yearly budgets and headcount, guessing at what could lay ahead as coronavirus vaccine distributions begin. And with the refi boom predicted to slow in the near future, lenders should be prepared to reduce costs — but where, and by how much?
Mortgage professionals discussed how their spending on tech and talent shifted to account for what they see — and don’t see — happening once the tide of refinances subsides.
(Read the full storyhere .)
Mortgage professionals discussed how their spending on tech and talent shifted to account for what they see — and don’t see — happening once the tide of refinances subsides.
(Read the full story
President Biden swears in new HUD chief of staff
Amid a flurry of federal appointments made official on the Biden administration’s first day in power, the U.S. Department of Housing and Urban Development received a new chief of staff.
Jenn Jones was sworn in virtually on inauguration day, filling the position vacated by Andrew Hughes. Jones will join former Ohio congresswoman Marcia Fudge as new hand-picked leaders of the department.President Biden chose Fudge to be the incoming HUD secretary as a replacement for Ben Carson in December.
(Read the full storyhere .)
Jenn Jones was sworn in virtually on inauguration day, filling the position vacated by Andrew Hughes. Jones will join former Ohio congresswoman Marcia Fudge as new hand-picked leaders of the department.
(Read the full story
December sets housing sales records, led by secondary cities
Four new records were set during a historic December for the housing market, according to Remax.
The number of for-sale properties plummeted 17.9% month-over-month and 33% year-over-year, reaching a new December low that hasn’t been hit since Remax started its National Housing Report in 2007. National inventory decreased to 1.8 months in December from 2.1 in November and 3.9 months a year earlier. Among the 53 largest metro areas, Boise, Idaho, continues to have the lowest inventory at 0.6 months. Now in a tie with Albuquerque, N.M., Salt Lake City followed with 0.7 months. A 6-month supply defines market equilibrium.
(Read the full storyhere .)
The number of for-sale properties plummeted 17.9% month-over-month and 33% year-over-year, reaching a new December low that hasn’t been hit since Remax started its National Housing Report in 2007. National inventory decreased to 1.8 months in December from 2.1 in November and 3.9 months a year earlier. Among the 53 largest metro areas, Boise, Idaho, continues to have the lowest inventory at 0.6 months. Now in a tie with Albuquerque, N.M., Salt Lake City followed with 0.7 months. A 6-month supply defines market equilibrium.
(Read the full story
Gabriella N. Baez/Bloomberg
FHFA asks for input on GSEs' exposure to climate change
The Federal Housing Finance Agency is seeking feedback on potential climate risks to Fannie Mae, Freddie Mac and the Federal Home Loan Banks and how the agency should account for global warming in its supervisory framework.
In a request for information issued Tuesday, the FHFA asked for public comment on how climate risks could affect the safety and soundness of the government-sponsored enterprises, and what risk management strategies the industry currently uses to address climate change and natural disaster risks.
(Read full storyhere .)
In a request for information issued Tuesday, the FHFA asked for public comment on how climate risks could affect the safety and soundness of the government-sponsored enterprises, and what risk management strategies the industry currently uses to address climate change and natural disaster risks.
(Read full story
Luke Sharrett/Photographer: Luke Sharrett/Bloo
Housing starts rose to fastest pace since 2006 in December
Home construction starts rose for a fourth-straight month in December to the best pace since late 2006 as builders responded to the robust demand for single-family housing.
Residential starts climbed by 5.8% to a 1.67 million annualized rate, according to government data released Thursday. That topped all estimates in a Bloomberg survey of economists that had a median forecast of 1.56 million and compared with anupwardly revised 1.58 million rate in November.
(Read full storyhere .)
Residential starts climbed by 5.8% to a 1.67 million annualized rate, according to government data released Thursday. That topped all estimates in a Bloomberg survey of economists that had a median forecast of 1.56 million and compared with an
(Read full story
