Tag Archives: Underwriting Standards

Modifications in line for the Home Affordable Refinance Program from the Obama administration will buoy homeowners with negative equity and origination markets, but field few other benefits for investors in mortgage-backed securities, according to a new outlook. Analytics provider CoreLogic released a statement Monday demarcating HARP├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós benefits and problem areas, skewering assertions that the program will alleviate a chronic lack of demand and showing that economic troubles may persist despite government assistance.

As debate heats up about whether to repeal the Dodd-Frank Act, witnesses testifying before the House Financial Services Committee Monday appeared as divided over the issue as the general public, with some criticizing the law and others praising it. The leaders of banks and credit unions largely panned the financial regulatory overhaul, highlighting the demand for more resources and manpower in compliance issues even as regulators themselves continue to scrutinize new loans. Others said that Dodd-Frank benefited the recovery.

The recently proposed Volcker Rule will sap nearly $1 billion in revenue from the nation's banks as lenders spend more time, resources, and manpower complying with regulations, according to a recent government study. The Office of the Comptroller of the Currency estimated that the rule as drafted by the FDIC, Federal Reserve, and other federal authorities will result in expenditures totaling $100 million for state, local, and other governments. The rule continues to stir controversy following its proposal earlier this month.

The nation's four biggest mortgage lenders recently signed up for modifications to the Home Affordable Refinance Program, adding credibility to a mass refinance opportunity that met with cheers and criticism this week. The Federal Housing Finance Agency announced this week that it would lift the 125-percent loan-to-value ratio for mortgages, do away with risk-based fees for borrowers with short-term loans, and extend the lifetime of the program until 2013. B of A, Citigroup, JPMorgan Chase, and Wells Fargo all came forward.

Bank shares lifted in the enthusiastic market response to news that European Union states reached a grand bargain to save the euro, but analysts speaking with MReport pare jubilation with forecasts for fewer refinance applications and home purchases. After two years of time spent in a debt crisis, European leaders cobbled together a third bailout measure to salvage debt-ridden Greece and prevent further peril for the continent├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós common currency.

The Federal Housing Finance Agency released projections Thursday that showed the GSEs may need anywhere from $51 billion to $142 billion more taxpayer funds over the next few years, even as one Republican lawmaker offered a plan that would siphon federal support for the companies. The scenarios show that the companies will ultimately need to withdraw anywhere from $220 billion to $311 billion from the federal government, a lower estimate for forecasts that originally fixed their needs at anywhere from $221 billion to $363 billion.