04
OCT
2016
fraud-rides-again

Fraud Rides Again

No fiery horse, no speed of light nor cloud of dust. Not even a Hi-Yo Silver. But, we’re returning to those thrilling days of yesteryear. No, not with the Lone Ranger, but a recent study found that Mortgage Fraud rides again. In their latest Mortgage Fraud Report, CoreLogic is...
03
OCT
2016
bbt-fine-doj-fha-83m

DOJ Strikes Again…for $83 Mil

This is an all too familiar theme. The Department of Justice (DOJ) settling with a lender over violations created by faulty FHA loans. This time, it is BB&T Corp., based in Winston-Salem NC, hit with an $83 million settlement for alleged quality control problems. QC problems?...
28
SEP
2016
Despite the historically low mortgage interest rates, new low down payment programs, easing of some credit standards, and special programs for first time and low to moderate income home buyers, we are still seeing homeownership rates decline. Why? It seems that the problem is not all about helping potential home buyers qualify for their financing; it’s as much about them being able to find affordable housing. As I’ve written before, I believe we have an affordable housing crisis in this country and now some are agreeing with me. We don’t need more buyers, although that couldn’t hurt. We need places for them to buy that they can afford. So along comes two different approaches to solving the affordable housing problem. Both offer some opportunity for lenders. First, we see draft legislation released by Senator Ron Wyden (D-OR) for a proposed middle income tax credit. Fashioned after the successful Low-Income Housing Tax Credit program, this will offer incentives to developers, by way of tax credits, for the creation and renovation of affordable rental housing. Although this may not immediately increase homeownership it will create a pathway for low to moderate income households. They can gain experience in making housing payments while taking their first step toward homeownership. This also presents an opportunity for lenders to finance these rental units once developed and offered for sale to investors. Another idea is to increase the availability of new manufactured homes. The reported average price of a manufactured home is about $70,000. A far cry from the cost of a stick built house at around $380,000. Further, the new manufactured homes are drastically improved from the old mobile homes and much more difficult to relocate, once set in place. The obvious challenge is the stigma associated with mobile homes and the parks in which most are located. However, there are many manufactured home developments, especially those created for seniors, which mirror stick built communities. These along with the rental housing create new lending opportunities, as well as additional investment options for the secondary markets and private investors. It’s just a matter of developing the right lending programs and guidelines, to finance these units. So, if we really want to increase homeownership, and provide more people with the chance to attain the American Dream, we need to look at more than just low rates and low down payment programs. We need to develop homes that first time home buyers can afford and the lending programs needed to finance them This coupled with an economy that provides jobs, stable employment and income will create not just more first time buyers but help them move on to become second and third buyers in the future. A future that will be bright with a robust housing market and a higher rate of homeownership. Now, that’s really good for lenders.

Affordable Housing Getting a Closer Look

Despite the historically low mortgage interest rates, new low down payment programs, easing of some credit standards, and special programs for first time and low to moderate income home buyers, we are still seeing homeownership rates decline. Why? It seems that the problem is not...
27
SEP
2016
clinton-trump-debate-round-1-one

Debate Hangover

I, like just about everyone else, except maybe some in Atlanta and New Orleans who played on Monday Night Football, watched the first Presidential Debate of 2016. My analysis; it was interesting… Personally, I don’t think that either candidate moved the needle either way. Clinton...
26
SEP
2016
fed-sorry-no-change-interest-rates

Fed Standing Pat on Rate Hike…Again

As you probably know by now, the Federal Open Market Committee once again voted to hold rates at their current level, at least for now. Based on the minutes of July’s meeting, the Fed indicated they were leaning toward holding the rates until they believed we recovered from the...
23
SEP
2016
cfpb-peggy-twohig-mba-regulatory-conference

CFPB Expresses Pleasure With Lender Performance

Speaking at MBA’s Legal and Regulatory Conference in Washington, DC, Peggy Twohig, CFPB’s Assistant Director, said that the CFPB is generally pleased with what lenders have done to comply with the new Dodd-Frank rules. Interestingly, she mentioned ability to repay and LO comp,...
22
SEP
2016
lenders-see-increased-profits-in-their-future

Some Lenders See Increased Profits in Their Future

According to Fannie Mae’s 3rd Quarter Mortgage Lender Sentiment Survey, some lenders are forecasting an increase in their profits over the next 3 months. Twenty-eight percent of those surveyed expect profits to rise, with 17% seeing it go down, and 55% say it will most likely...
21
SEP
2016
credit-trending-scores-fico-trending

What’s Trending in Credit Reports?

Yo! Are you ready for the new improved credit reports providing you with trends in a consumer’s debt repayment history? You better be, because as of September 24th, Fannie requires that all loans submitted through DU must have this additional credit information. Whether you want...
20
SEP
2016
cfpb-choice-part-two-background

Dodd-Frank Reform (Part 2): Background on the CHOICE Act

My recent blog on the CHOICE Act talked about what’s broken in Washington, DC. Here’s a little more detail on the political wrangling that went on behind the scenes when the CHOICE Act went before the House Financial Services Committee for markup. (CHOICE) The Democrats decision...
19
SEP
2016
cfpb-choice-part-one-futility

Dodd-Frank Reform (Part 1): An Exercise in Futility

In June, House Financial Services Committee Chair, Jeb Hensarling (R-Texas), introduced legislation to roll back Dodd-Frank. This legislation, H.R. 5983, is known as the Financial CHOICE Act (Creating Hope and Opportunity for Investors, Consumers, and Entrepreneurs). Cute. Do...