Tag Archives: Underwriting Standards

With an upsurge in demand, banks resumed tightening standards for residential mortgage loans, the Federal Reserve said Monday in a quarterly survey for bank lending standards. According to the survey, a net 30.2 percent of bank surveyed in the Senior Loan Officer Opinion Survey saw increased demand in the first quarter for traditional mortgage loans compared with a net 3.8 percent reporting stronger demand in the fourth quarter. The survey found that a net 1.9 percent of survey respondents also reported tightening loan standards.

Twenty-four trade groups and associations signed off on a comment letter Friday that calls on the Consumer Financial Protection Bureau to give creditors more legal leeway when it comes to Qualified Mortgages. The two-page letter ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô headed up by the American Bankers Association, Mortgage Bankers Association, National Association of Home Builders, and National Association of Realtors, among others ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô framed forthcoming rules around credit availability and sound home loans. Influential trade groups continue to criticize the rule.

A lawsuit was filed against GFI Mortgage Bankers alleging it charged African American and Hispanic borrowers higher interest rates and fees on mortgage loans because of their race rather than their creditworthiness, the U.S. Justice Department announced in a statement Tuesday. The complaint was filed in the Southern District of New York under the federal Fair Housing Act and Equal Credit Opportunity Act. According to the statement, GFI knew that its loan officers priced loans based on factors that resulted in thousands of dollars in overcharges for minority borrowers.

Mortgage insurance companies wrote $5.4 billion new pools of risk in February, a shift from $5 billion last month. Mortgage Insurance Companies of America revealed Friday that the latest figures reflect a climb up from $4.2 billion. The companies included Genworth Mortgage Insurance Corp., Mortgage Guaranty Insurance Corp., and Radian Guaranty Inc. MICA members said that their certificates reached 24,879 borrowers with intentions to buy or refinance their homes last month. Insurance-in-force for the companies roughly amounted to $398 billion for February.

Higher gasoline prices and concerns about Chinese growth fed bond investments, driving down mortgage rates once again amid worrying signs about the economy. Mortgage giant Freddie Mac found rates for the 30-year fixed-rate mortgage falling from 4.08 percent last week to 3.99 percent this week. The company said the 15-year loan fell from 3.30 percent last week to 3.23 percent this week, a change of pace from 4.09 percent seen year-over-year. Five-year and 1-year adjustable-rate mortgages meanwhile slid from 2.96 percent and 2.84 percent to 2.90 percent and 2.78 percent, respectively.

Referrals from real estate agents guide about one-third of mortgage-financing decisions for today├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós homebuyers, according to a recent survey. Campbell Surveys and Inside Mortgage Finance polled about 1,800 Realtors in January to learn that agents recommended about 60 percent of the business for mortgage lenders. The survey inferred from the results that real estate agents influence or shape some 34 percent of mortgage-financed home purchases. Recommendations by many agents came about as a result of pre-existing relationships with lenders.

New-homes sales fell 1.6 percent in February to a seasonally adjusted annual rate of 313,000, the second straight monthly decline, the Commerce Department and HUD jointly reported Friday. Sales for January were revised downward from 321,000 to 318,000. The median price of a new home in February jumped to $233,700 from $215,700. The median price in February was the highest since last June when the median price hit $240,200.The median price in February was 6.2 percent higher than figures for the same seen in February last year.

Housing starts fell 1.1 percent in February to 698,000, compared with market expectations for a smaller decline, the Census Bureau and HUD jointly reported Tuesday. Single-family starts plunged 9.9 percent to 457,000, the steepest decline in a year, according to the agencies. The starts suggest strongly January's unexpectedly strong report was influenced by unseasonably warm weather, which pulled starts forward. Single-family starts have been weak for the past three years. Housing permits, unaffected by weather, rose 5.1 percent in February.

Builder confidence was flat in March, matching a downwardly revised February index of 28, the first time in six months the index has not increased, the National Association of Home Builders reported Monday. The builder assessment of present home sales conditions actually dipped in March, falling to 29, the first decline since last September. The outlook for home sales in the next six months rose to 36 ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô the highest level since June 2007 - from 34 in February. Buyer traffic was flat in March at 22. The drop in the index in the West census region was precipitous.

The inspector general of the Federal Housing Finance Agency released a report Tuesday that criticizes the agency, Fannie Mae, and Freddie Mac for a series of ongoing oversight problems with mortgage servicers. The document charges that the FHFA failed to implement service guidelines for the mortgage company last year and portrays today├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós environment as one in which the agency, GSEs, and servicers all punt responsibility down the ladder. It also alleges that Fannie Mae and Freddie Mac routinely fail to swap servicer information.