Qualified Mortgages

The CEO of SWBC Mortgage discusses her top priorities for the Mortgage Bankers Association, the election, the CFPB's seasoned QM proposal and what to expect at this week's conference.

For many borrowers who might have qualified for conventional financing before the pandemic, non-QM loans are the only path forward toward homeownership.

The Consumer Financial Protection Bureau's overhaul of its Qualified Mortgage standard is alarming free-market advocates who say it will precipitate a return to easy credit and higher defaults and could disproportionately harm minorities.

With the onset of COVID and the reaction by the Federal Reserve Board and other agencies, market pressures have reduced credit availability significantly.

The proposals offer lenders both cause for celebration and for concern.

The agency’s plan to extend the "qualified mortgage" stamp of approval to more loans could help lenders that rely on alternative data and cushion the blow of other QM changes for Fannie Mae and Freddie Mac.

The new reality for investors and originators accounts for forbearances and ability-to-repay.

The Consumer Financial Protection Bureau says the proposal would increase access to credit, but consumer groups argue that it will encourage lenders to make high-cost loans while protecting them from legal liability.

In a letter to the Consumer Financial Protection Bureau, the Mortgage Bankers Association recommended adding six more months to the latest GSE patch proposal.

The company reported nearly $23 million in losses for the second quarter, but that was an improvement on a quarter-to-quarter basis.

With year-to-date issuance at $51.7 billion, investor demand appears to remain strong despite economic headwinds of the pandemic.

Even with the second quarter's market disruption, Redwood Trust still regained profitability.

JPMorgan Chase Asset and Wealth Management Private Bank is pooling over 400 seasoned mortgage loans from its high-net worth clients. The loans are considered low-risk, but were not tested against CFPB qualified-mortgage standards.

The company formally reported a nearly $65 million loss in the first quarter as the coronavirus affected its operations in March.

An imminent high court ruling about the independence of the bureau's director, coupled with an election victory for Joe Biden, could doom a plan to extend GSEs' exemption from tough debt-to-income requirements on mortgages.

The Consumer Financial Protection Bureau plans to change the definition of what constitutes a qualified mortgage from a 43% debt-to-income limit to a price-based threshold, and further extend a temporary exemption given to Fannie Mae and Freddie Mac.

The REIT will add $500 million in capital through a senior secured loan, and it received a $1.65 billion term facility.

Looming economic uncertainties forced mortgage lenders to tighten underwriting standards in May.

The company's planned two-week halt on originations turned into more than two months on hiatus because of coronavirus-related market disruptions.

With no way of knowing just how many borrowers will need the mods after the coronavirus forbearance period ends, lenders are deploying artificial intelligence and servicing protocols to tame the ferocious piles of paperwork awaiting them.