The FHA premium cut and agency low down payment loans were intended to increase homeownership among first-time and low to moderate income home buyers. It hasn’t worked so far. The premium cut tends to have just redirected borrowers from traditional conventional loan programs into an FHA-insured loan. Also, those who recently closed using FHA insured loans refinanced those same loans…
The CFPB celebrated its 4th birthday today, July 21st, 2015. In connection with this celebration, they issued an announcement highlighting all they’ve done over the past four years to help consumers (CFPB4U). Quite a bit but at what cost? Although CFPB may have benefited many consumers at varying levels, have they also hurt some in other areas? I can’t speak…
Last year, Fannie and Freddie announced some relief to lenders under their Reps and Warrants. Under this announcement, lenders could receive relief from responsibility for indemnification and repurchases via two methods; Acceptable Payments History: Borrower making payments for 36 consecutive months with no more than one 30 day delinquent; or Quality Control Reviews: a satisfactory review by the agency that…
Provident Funding Associates, a major California-based wholesale lender, recently settled with the Consumer Financial Protection Bureau and the Department of Justice to the tune of $9 million. The settlement was not for any violations made by Provident, but for lending discrimination by Brokers who originated loans for Provident. The discrimination came about in the form of higher rates being charged to…
I was chatting with a friend, John Castiello, who works at Radian about the potential pitfalls associated with high Loan-To-Value lending. If you’ve followed my blog, you know my concerns. John mentioned that Radian, as well as most mortgage insurance companies, offers programs to insure lenders against loss in the event of the non-performance of these loans. That’s good for…
(Except from MarketLogics 5-18-15) Imagine that data quality and appropriate manufacturing of mortgage loans really do matter. Think about this quote from the NYTimes Opinion piece, Breaking Laws in the Mortgage Bubble. “The trial against Nomura and R.B.S. rebuts the widespread notion that banks’ greed during the bubble did not amount to lawbreaking, that somehow it was the housing crash,…
