Mortgage – HousingWire |
- 20 state attorneys general take aim at mortgage servicers
- Mortgage applications slide 2.7% in last week of 2021
- Opinion: Mortgage industry will shed 100K jobs this year
| 20 state attorneys general take aim at mortgage servicers Posted: 05 Jan 2022 04:30 AM PST Some Federal Housing Administration-approved mortgage servicers have routinely flouted the agency's loan modification program, according to Washington, D.C. Attorney General Karl Racine and 20 other state attorneys general. The attorneys general wrote in a Dec. 21 letter that a number of mortgage servicers employed by FHA-approved lenders failed to adequately implement loan modification options the FHA introduced in July. The loan modification options allowed eligible borrowers to reduce their principal and interest payments by 25%. FHA required mortgage servicers to implement the program by Oct. 21, 2021. But rather than adhering to the program, some mortgage servicers of FHA-insured loans allegedly sent borrowers notices that fail to mention the relief options, requiring paperwork and imposing qualifications that are not necessary under the FHA's guidelines. Servicers also told borrowers that the loan modification option did not exist, the attorneys general claim. A spokesperson for the Department of Housing and Urban Development said the agency takes the concerns raised in the letter very seriously. "FHA is committed to assisting homeowners struggling because of the pandemic to keep their homes if at all possible, and expects servicers of FHA-insured mortgages to take all necessary steps to work with borrowers, based on their individual situations, to identify the best FHA loss-mitigation home retention option available to them," a HUD spokesperson said. "No homeowner with an FHA-insured mortgage who is struggling financially because of the pandemic should be unnecessarily hindered by their mortgage servicer from receiving the assistance for which they are eligible." It's unclear how widespread the alleged misdeeds are. But according to the attorneys general, they spanned more than one mortgage servicer. In a press statement accompanying the letter, the Washington, D.C. Attorney General's Office said "several mortgage loan servicers employed and approved by FHA" had not adhered to the program. FHA's loan modification plan was envisioned to especially help low-income households, first-time homeowners, and households of color that have been disproportionately impacted by the pandemic. But the program can only be effective if lenders implement it, the letter notes, highlighting a challenge of designing government relief programs that rely on the private sector to carry them out. The state attorneys general demanded the FHA take "immediate action" to ensure mortgage servicers adhere to the loan modification program. They also asked FHA to require its lenders to demonstrate their loan servicers are taking affirmative steps to implement the program. The state attorneys general also raised concerns that servicers adequately evaluate borrowers for loss-mitigation, even as they await the $10 billion in federal aid from the Homeowners Assistance Fund. "HAF should be a fund of last resort and should not replace servicers' obligations to evaluate homeowners for all loss mitigation options," the attorneys general write. In a statement, Racine called the mortgage servicers' misdeeds "illegal, unacceptable, and dangerous.” He added that they discriminate against low-income borrowers and borrowers of color, groups the FHA disproportionately serves. "The purpose of the federal program is to reduce the displacement of families from their homes, and, as a result, thwart homelessness during the pandemic," said Racine. "The truth is that too many FHA approved mortgage loan servicers have not been honest and transparent about the FHA's protections for borrowers." The post 20 state attorneys general take aim at mortgage servicers appeared first on HousingWire. |
| Mortgage applications slide 2.7% in last week of 2021 Posted: 05 Jan 2022 04:00 AM PST Mortgage applications decreased 2.7% from two weeks earlier, according to the Mortgage Bankers Association survey for the week ending Dec. 31, 2021. The results include adjustments to account for the holidays. The holiday adjusted Refinance Index decreased 2% from two weeks ago and was 40% lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 4% from two weeks earlier. Mortgage applications increased 2% the week prior, largely due to an increase in Federal Housing Administration refinances. "Mortgage rates continued to creep higher over the past two weeks, as markets maintained an optimistic view of the economy," said Joel Kan, MBA's associate vice president of economic and industry forecasting. The 30-year fixed rate increased 6 basis points to 3.33%, the highest since April 2021, which drove a decrease in refinance activity, Kan said. "Refinance demand continues to dwindle, as many borrowers refinanced in 2020, and in early 2021 – when mortgage rates were around 40 basis points lower," said Kan. The purchase market also weakened in the last week of the year, falling to its lowest level since October 2021. Average loan sizes were lower, although home-price appreciation remains very high, Kan said. Despite tight supply and lack of affordability, 2021 was another banner year for purchase originations. But the trade association anticipates that 2022 will surpass it, predicting that total purchase activity will reach $1.74 trillion. Mike Fratantoni, chief economist at the MBA, forecast that millennials reaching peak first-time homebuyer age, a strong job market and continued increases in home prices will all contribute to a record-breaking 2022. The refinance share of mortgage activity increased to 65.4% of total applications from 63.9% the previous week. The adjustable-rate mortgage share of activity decreased to 3.3% of total applications. The FHA share of total applications increased to 9.2% from 8.5% the week prior. The VA share of total applications decreased to 11.3% from 11.4% the week prior. The USDA share of total applications stood unchanged at 0.4%. Here is a more detailed breakdown of this week's mortgage applications data: The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) increased to 3.33% from 3.31%. The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $548,250) decreased to 3.31% from 3.35%. The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.40% from 3.39%. The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 2.60%. The average contract interest rate for 5/1 ARMs decreased to 2.45% from 2.74%. The post Mortgage applications slide 2.7% in last week of 2021 appeared first on HousingWire. |
| Opinion: Mortgage industry will shed 100K jobs this year Posted: 04 Jan 2022 09:43 PM PST The most wonderful time of the year, as the song would have us believe, comes to a close with Epiphany, the 12th day of Christmas, Jan. 6. I do hope everyone had a joyous holiday season, spending some relaxing time with family and friends. The holiday season is winding down. So is the 24-month refinance market, the biggest of its kind in all of mortgage banking history. All good things must end. And this time, the most wonderful time of the year gives way to what, in the mortgage industry, could be the most awfullest time of the year. No question about the fact that parodies are either a cheap, cynical trick or clever way of getting attention. I think there are a little of both here. So, with that in mind… The Most Awfullest Time of the Year It's never fun to be the bearer of bad tidings. Last fall I wrote a report, "Productivity, the One KPI to Rule Them All," that among other things, states very plainly that the mortgage industry will go through a major downsizing during 2022. IF, and it's always an IF, volume projections play out, then we are at least 30% over-staffed. In sheer numbers this means there will likely be as many as 100,000 fewer mortgage professionals by the end of this year. Oh, and the 100,000 applies just to lenders. It's simple productivity math. Yet the downsizing has a ripple effect. Think technology and service providers, too — a smaller mortgage market affects everyone. This is news, but it's not newsworthy. There will be many articles, probably, about layoffs throughout 2022. If you're surprised you're not paying attention. Like I said, it is news – most everything is – but it's not newsworthy. The mortgage industry has been going through these cycles since the 1980s. This time, though, the numbers will be bigger. There will be far more newsworthy items than the employment size of the industry this year. How about we focus on big issues like affordable housing, lending to low- and moderate-income borrowers and helping first-time homebuyers achieve the American Dream in a market that's nigh on unaffordable? There'll be plenty of racing Lest you think this is callous and I’m uncaring, consider this: early in my career I participated in laying off about 100 mortgage professionals as the December holidays began. It was neither fun nor funny. Quite the opposite, actually. The memory of it left an indelible mark on me and the way I worked with teammates from then on. While it's easy to say the industry will have 100,000 fewer employees at the end of 2022, it has to be just as easy to remember these are individual, talented people. And people are this industry's most important and valuable asset. My hope is that we'll collectively be thoughtful in how we downsize, turning as many team members as possible toward the important work of originating loans and helping borrowers reach the closing table. Remember, we're facing the largest cohort of first-time homebuyers in our history. They have plenty of information — thanks to the internet — though little actual knowledge. Only people, NOT TECHNOLOGY — can fill the knowledge gap. Think about this as you build your staffing plan for 2022. Dan Green is Principal at The BlackFin Group. This column does not necessarily reflect the opinion of HousingWire's editorial department and its owners. To contact the author of this story: To contact the editor responsible for this story: The post Opinion: Mortgage industry will shed 100K jobs this year appeared first on HousingWire. |
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