Mortgage – HousingWire

Forbearance rate dips to 1.67% in November
DocMagic launches new closing solution
DOJ, CFPB put mortgage servicers “on notice” after veterans’ complaints

Forbearance rate dips to 1.67% in November

Posted: 20 Dec 2021 01:55 PM PST

The share of mortgage loans in forbearance decreased by 39 basis points to 1.67% as of Nov. 30, according to the Mortgage Bankers Association (MBA), the latest sign that the sun is setting on loan forbearance agreements hammered out under the CARES Act.

Under COVID-19 legislation signed by President Donald Trump in April 2020, many homeowners could strike deals with their lenders on a year-long or up to 18-month forbearance plan. With many such plans expiring, forbearance fell across the board.

Just 835,000 homeowners are still in forbearance plans, according to the MBA, after a COVID-era peak of over 4 million borrowers.

The most notable decline was in the portfolio loans and private-label securities (PLS), which dipped 106 basis points to 3.94%.

Ginnie Mae loans decreased by 42 bps to 2.10% of the total. Meanwhile, Fannie Mae and Freddie Mac loans in forbearance declined 16 basis points to 0.76% in November.

"The share of loans in forbearance in November declined — albeit at a slower pace than October — as borrowers continued to near the expiration of their forbearance plans and moved into permanent loan workout solutions." said Marina Walsh, MBA's vice president of industry analysis, in a statement

The survey included data on 36.5 million loans serviced as of Nov. 30, 73% of the first-mortgage servicing market. The MBA numbers show that 18.3% of total loans in forbearance were in the initial stage last month, and 68.4% were in a forbearance extension. The remaining 13.3% were re-entries.

During the last 17 months (from Jun. 2020 to Nov. 2021), MBA's data revealed that 29.1% of forbearance exits resulted in a loan deferral or partial claim. Also, 19.9% represented borrowers who continued to pay during the forbearance period.

However, 16.8% were borrowers who did not make their monthly payments and did not have a loss mitigation plan. In addition, 14.1% resulted in a loan modification or a trial loan modification.

The analysis of the post-forbearance landscape shows that 83.7% of the total completed loan workouts since 2020 were current in November, down from 84% in October.

"While there was some deterioration in the performance of borrowers in post-forbearance workouts, four out of five overall remained current through November," Walsh said.

Regarding the servicing industry in general, total loans not delinquent or in foreclosure nudged up from 94.3% of the servicing portfolio volume in October to 94.6% in November, reflecting a faster wage growth and the unemployment rate dropping to 4.2%, according to Walsh.

The post Forbearance rate dips to 1.67% in November appeared first on HousingWire.

DocMagic launches new closing solution

Posted: 20 Dec 2021 01:10 PM PST

DocMagic announced on Monday the rollout of eDecision, a fully automated platform that it said will significantly expand the level of analysis applied to e-eligibility determination for eClosings.

The automated loan document preparation and eMortgage services provider claims the new platform delivers a clear-cut, highly accurate decision telling users exactly how far they can take their closing digitally based on the unique attributes of the loan transaction and the county-level eRecording acceptance.

eDecision starts looking at a transaction's eligibility for eClosing as soon as the first set of disclosures are generated, and it continues to check for e-eligibility throughout the entire loan process.

"Our goal in developing eDecision was straightforward: to help clients execute flawless eClosings and bring a new level of automation to the overall process by providing lenders with an immediate determination of how ‘e’ they can be," Dominic Iannitti, president and CEO of DocMagic said in a statement.

Users do not have to leave DocMagic's platform, use a third-party application or access an ancillary database. DocMagic’s core processes include eClosing selection, eNote certification, eRecording readiness, knowledge-based authentication, eNotary acceptance and investor acceptance. Those processes improve eClosing workflows and to ensure a seamless eClosing process, the company said.

The Guide to Accelerating Closings in 2022

The most advantageous step lenders can take to combat margin compression – that will have an immediate impact, as well as long-term scalability – is to digitize their loan origination process.This eBook spotlights how lenders can digitize closings to improve the experience for their customers, reduce costs and close more loans faster.

Presented by: First American Docutech

Each of eDecision's core capabilities provides a check on whether or not each part of the closing process can be completed digitally in a given jurisdiction. The process starts with a check on whether a lender is certified to originate eNotes and is registered with MERS, and continues all the way up to check if an investor will purchase an electronically closed loan, making it easier to see if a loan is eligible for the secondary market.

With many closing and title companies citing the various local regulations as one of the biggest hurdles to streamline the closing experience, DocMagic hopes eDecision will be a major game changer for the industry.

“At DocMagic, with each innovation we engineer, we strive to eliminate manual processes and improve the overall user experience," Iannitti said in a statement. "We don't want our clients having to go elsewhere to research or rely on disparate third-party systems for what we believe should be a fully-integrated analysis that begins the moment our services are accessed for a particular loan transaction.

The post DocMagic launches new closing solution appeared first on HousingWire.

DOJ, CFPB put mortgage servicers “on notice” after veterans’ complaints

Posted: 20 Dec 2021 10:59 AM PST

Two federal regulators said on Monday that they will double down on scrutiny of mortgage servicers, following complaints of housing rights violations made by military families and veterans.

In a joint letter, the U.S. Department of Justice (DOJ) and the Consumer Financial Protection Bureau (CFPB) said they are watching to ensure mortgage servicers fully comply with federal laws. The agencies also sent a letter to landlords and housing providers.

The CFPB said it received complaints about inaccurate credit reporting, misleading communications to borrowers, and requiring lump sum payments to reinstate mortgage loans. The CFPB said it is reviewing the complaints in light of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).

Rohit Chopra, the CFPB director, said in a statement that the illegal foreclosures of military families in the last crisis were one of the financial industry's worst failures.

"The CFPB will be closely watching mortgage servicers and will hold them accountable for illegal tactics perpetrated against military families."

Violations during the Great Recession resulted in numerous settlements, including one for $186 million between the DOJ and some of the country's largest mortgage servicers.

"Mortgage servicers and landlords must ensure that they are in full compliance with federal laws intended to protect service members and their families during military service," Assistant Attorney General Kristen Clarke said.

The joint statement is the most recent indication that regulators are taking a hard line with mortgage servicers.

Earlier this year, the CFPB told mortgage servicers “unprepared is unacceptable,” and that it would closely monitor how servicers guide mortgage borrowers out of forbearance. Last month, federal banking agencies, the CFPB and state financial regulators announced they would resume supervision and enforcement activities of mortgage servicers.

The DOJ and CFPB’s joint statement comes at a difficult time for mortgage servicers. Mortgage servicers are still negotiating with 1.25 million borrowers exiting forbearance plans related to the Covid-19 pandemic, including military borrowers. Roughly 7.6 million homeowners entered forbearance during the Covid-19 pandemic. The majority have resumed their regular payments.

Also, CFPB's additional rules limiting foreclosures are expected to expire on Dec. 31. The rules directed servicers to give borrowers a meaningful opportunity to pursue affordable loss mitigation options before starting a foreclosure process.

In their letter to landlords and other housing providers, the CFPB and DOJ stated that some veterans and military families may have relocated to respond to the crisis. But they have additional housing protections under the Servicemembers Civil Relief Act, enforceable by the DOJ and service members themselves.

Service members have legal housing protections, such as the prohibition on foreclosing and eviction without court orders and the ability to terminate residential leases early, and without penalty, the agencies wrote.

The post DOJ, CFPB put mortgage servicers “on notice” after veterans’ complaints appeared first on HousingWire.

Loans And Mortgage

Tuesday, December 21, 2021