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Tag Archives: Underwriting Standards

Beige Book: Economy Expanded ‘Modestly’ in September


The nation's economy generally expanded modestly from mid-August until the end of September, the Federal Reserve said in its periodic Beige Book report issued Wednesday. The report, the last Beige Book to be issued prior to Election Day, painted a mixed regional picture, with a leveling off of economic activity in New York and a slowing in the pace of growth in Kansas City. Meanwhile, the remaining 10 federal reserve districts reported that "growth continued at a modest pace."

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U.S. Sues Wells Fargo over Underwriting of FHA Loans

Wells Fargo faces federal charges for alleged misconduct and fraud related to its role as a direct endorsement lender for the Federal Housing Administration (FHA) over a span of more than 10 years. The civil lawsuit was filed Tuesday in a Manhattan federal court and alleges Wells Fargo falsely certified the credit and underwriting quality of thousands of FHA loans it originated which later defaulted, costing the federal agency hundreds of millions of dollars.

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Fitch: Basel III Rules Could Crimp Lending Stateside

Proposals found in Basel III to raise capital requirements for mortgage loans would increase borrower costs for traditional mortgages and make nontraditional mortgages less available at regulated banks, according to a commentary from Fitch Ratings. "U.S. regulators' 'notice of proposed rulemaking' addressing capital requirements and risk-weighted asset calculation criteria would, if adopted, ultimately push banks away from all but the most conventional lending," Fitch said.

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Survey: 24% of Loan Officers Consider Firm Leaders ‘Illogical’

Twenty-four percent of loan officers think their firm leaders lead with "unclear" and "illogical" visions, according to a recent survey. Hammerhouse, LLC, a recruiting and strategic growth firm for the financial services industry, recently released a survey it conducted with loan officers. The findings touched on leadership, culture, business, and technology for loan officers from around the residential mortgage lending industry. Thirty-two percent of mortgage industry professionals believe their firm's technology needs an upgrade.

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Q2 Profits Rise for Independent Mortgage Bankers, Originators

Independent mortgage bankers and originators saw their profits rise over the second quarter, according to the Mortgage Bankers Association. The trade group released a statement on Thursday that found independent mortgage banks and subsidiaries clinching $2,152 on average for every loan from the second quarter. That's an increase from $1,654 per loan from the quarter before. Net production income shot up by 107 basis points, a leap from 82 basis points from the first quarter.

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Report: Small, Midsize Servicers to Lose Most Under New Rules

The Consumer Financial Protection Bureau strikes once more ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô against the little guy, according to recent reports. One of those came from analysts with Moody's Investors Service on Thursday. Their report suggests that a tide of new rules from the credit bureau will likely impose "costly" and "challenging" new costs on small to midsize servicers. As for the bigger guys? Analysts say they may just walk away from the rules without a scratch. And theirs isn't the first report to say as much. Read more to learn why.

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Banks Ease Lending Terms to Meet Mortgage Demand

Commercial banks eased standards for residential mortgage loans to meet a sharp increase in demand in the second quarter, the Federal Reserve reported Monday in its quarterly survey of bank lending standards. According to the quarterly survey, a net 52.5 percent of bank officers responding to the Senior Loan Officer Opinion Survey reported increased demand for traditional mortgage loans in the second quarter compared with a net 30.2 percent reporting stronger demand in the first quarter.

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Hawaii Pushes New Laws for Originators, Servicers

The Aloha State recently passed three new bills related to mortgage servicing and mortgage origination. All three went into effect at the beginning of this month. The first requires the Office of Consumer Protection to educate consumers regarding fraud schemes aimed at homeowners facing foreclosure. The second offers adjustments to loan originator registration fees and amends Hawaii's Secure and Fair Enforcement for Mortgage Licensing Act to comply with a host of recent changes to federal law.

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