Mortgage – HousingWire |
- 2022 opens with a big MSR bulk-sale offering
- New CEO for Rocket Mortgage
- FHFA to GSEs: Back to the drawing board on Duty to Serve
- Covius integrates Stavvy for RON and eSign on loan mods
- Mortgage rates start 2022 with an increase
- SitusAMC creating safety net for the private-label market
- RMF acquires AAG reverse mortgage servicing portfolio
| 2022 opens with a big MSR bulk-sale offering Posted: 06 Jan 2022 01:51 PM PST  Denver-based Incenter Mortgage Advisors is in the market with a $10 billion bulk-sales package of mortgage-servicing rights (MSRs) tied to Fannie Mae and Freddie Mac loans. The MSR offering involves 36,185 loans that are fairly evenly split between Fannie- and Freddie-backed mortgages. The weighted average age of the loans is 10.8 months, with an average interest rate of 2.898%, according to the bid documents. The average loan size for the bulk package is $276,596 — with a weighted average FICO credit score for the underlying loans of 766.7. The seller is not identified in the offering, which indicates the deadline for final bids is Jan. 12. Incenter Managing Director Tom Piercy would only say that the seller is a "nonbank." "This is … an independent mortgage company that is looking to pare back its holdings of MSR assets on the balance sheet," Piercy explained. About one-third of the mortgages in the package were originated in California, Texas or Florida, the bid documents show, with Texas leading the pack by loan count with a 13.4% share (4,838 loans valued at $1.2 billion). California originations represent the highest share of loan volume, at 15.4%, or a current balance of $1.54 billion across 4,080 mortgages. Florida originations account for 9.6% of the loan count in the offering (3,486 mortgages) and 8.9% of the loan volume ($887 million). Most of the loans involve single-family homes, — some $8.7 billion by loan balance — with the remaining loans by balance split between townhomes and condos. About a quarter of the loans (9,004) are purchase mortgages, or $2.5 billion by current balance — with the remaining loans falling into the refinancing "loan-purpose" category. Also, 91% of the mortgages by loan count involve owner-occupied properties. "We didn’t cherry pick this," Piercy added. "This is a cross section of [the lender's] entire portfolio [being marketed for sale] simply to pare back the asset and take advantage of some of the market opportunities … as a result of where rates are today." As markets and the Federal Reserve continue to signal that interest rates are upward bound, that has the effect of depressing demand for home-refinancing loans, which in turn helps to bolster the value of MSRs. That's because loan prepayment speeds slow when refinancing ebbs. Fewer loan prepayments via refinancing ensures that MSR assets — which represent a slice of the interest on a mortgage — will have a longer cash-flow life for investors. The average weighted servicing fee for the package, according to the offering documents, is 0.2570%. Piercy stressed that a slow, steady rise in rates — as appears to be the trajectory now — is the ideal, given that significant rate volatility is not a positive for the MSR market. In addition to the MSR value push from a rising-rate environment, one industry source, who asked not to be named, also points out that the escrow balances associated with the loans being serviced also benefit from higher rates. "My escrows right now are worth nothing or next to nothing," the source said. "But if rates keep going up, at some point my escrows [generally deposited in bank accounts] are going to be worth something." In the case of Incenter's current bulk MSR offering, the escrow balance for the underlying loans as of Jan. 5, 2022, totaled $44.1 million. Year to date through Dec. 1, 2021, a total of $693 billion in agency mortgage servicing rights were transferred through sales transactions, of which nearly $550 billion involved nonbanks, according to mortgage-data analytics firm Recursion. That's up significantly from the same period in 2020, when a total $385 billion in MSRs were transferred, with the bulk of those transactions involving nonbanks as well. The report encompasses transfer-transaction activity involving Fannie Mae, Freddie Mac and Ginnie Mae MSRs. Incenter Mortgage Advisors also benefited from favorable market dynamics as last year came to an end. In November, it unveiled three MSR bulk-sales packages that were put out for bid involving primarily Fannie Mae and Freddie Mac loans that combined were valued at nearly $8 billion. In early October 2021, HousingWire reported on the details of two other bulk-servicing packages being marketed by Incenter. One offering was for a $6.1 billion Ginnie Mae servicing portfolio and the other for a $3.9 billion Fannie Mae and Freddie Mac loan-servicing portfolio. The MSR transfer market is expected to remain very active in the new year as market conditions continue to fuel the value of the assets. "We’re seeing [MSR] values trending up, and I’m pretty bullish on this for the foreseeable future," Piercy said. "… It’s going to be a robust 2022." The post 2022 opens with a big MSR bulk-sale offering appeared first on HousingWire. |
| Posted: 06 Jan 2022 11:33 AM PST Rocket Companies announced this week that its CEO Jay Farner has stepped away from his role as Rocket Mortgage CEO, to assume the role of CEO of Rocket Central, the mortgage company’s fintech platform. Farner assumed his new role Jan. 1, according to a press release from the Detroit-based company, and will retain his role as CEO of Rocket Companies, the parent company of both Rocket Mortgage and Rocket Central. Bob Walters, COO of both Rocket Companies and Rocket Mortgage, has stepped into the role as CEO of Rocket Mortgage. Prior to the promotion, Walters oversaw mortgage servicing, client experience operations and capital markets and technology teams at Rocket Mortgage. In addition to his new duties as CEO of Rocket Mortgage, Walters will continue to be COO of Rocket Companies, the press release said. The move came with other changes to the C-suite at the mortgage lender. Tim Birkmeier, chief revenue officer at Rocket Mortgage, will become its president, while Angelo Vitale, who previously held the role of CEO at Rocket Central, will now solely focus on his roles as general counsel and secretary at Rocket Companies, the company said. Rocket Pro TPO redesigns pricing calculator for brokers Rocket Pro TPO aims to help its broker partners grow their businesses. The new Pricing Calculator provides brokers with fast, reliable and accessible information that can help differentiate them from competitors. In the midst of this serious housing shortage, brokers need tools to help them provide top-notch service to homebuyers. Presented by: Rocket Pro TPO"As a platform business, Rocket Companies provides services from each of its brands to clients who want help making a complex transaction easier – like getting a home loan, purchasing a car or working on their budgeting and personal finances thanks to the recent acquisition of Truebill," the company said. Rocket acquired Truebill — a budgeting and credit improvement app with 2.5 million users — for $1.275 billion in cash in December 2021. At the time, the company said the acquisition was a step toward step toward a centralized platform for clients to manage their financial lives. Analysts have said the acquisition signaled Rocket’s push to diversify its business, particularly in technology, at a time when mortgage volume is slowing. Farner has also been very vocal about the company's technological prowess and analysts who cover Rocket said his transition to a new role is meant to signal Rocket’s fintech capabilities. Farner will continue to work closely with both Walters and Birkmeier, he said in a statement. “Rocket Mortgage is in excellent hands with Bob and Tim, who have been instrumental drivers in the company’s growth,” said Farner. “We have worked side-by-side for decades and will continue to do so.” Farner added, “Tim has worked closely with the mortgage banking team to hone our expertise in providing an exceptional experience for everyone – ensuring we make good on our promise, ‘Every Client. Every Time. No Exceptions. No Excuses.’" In reaction to the news, Rocket Companies stock dipped, and was trading at $14. 18 before closing on Wednesday. The post New CEO for Rocket Mortgage appeared first on HousingWire. |
| FHFA to GSEs: Back to the drawing board on Duty to Serve Posted: 06 Jan 2022 09:00 AM PST A federal law mandates that Fannie Mae and Freddie Mac help households on moderate, low, or very low incomes. The government-sponsored enterprises must do this by setting a plan every three years, dubbed Duty to Serve, that provides lending liquidity and preservation goals for manufactured, rural, and affordable housing. But according to the Federal Housing Finance Agency, which has oversight power over Fannie and Freddie, the GSE’s must go back to the drawing board when it comes to their 2022-2024 Duty to Serve plan. In fact, according to an FHFA spokesperson, neither Fannie nor Freddie’s plan is sufficient for any of the three underserved markets in question. The spokesperson declined to say what changes FHFA requested, or whether the GSEs had received warning the Duty to Serve plans might fall short. A spokesperson said that discussing the plans shortcomings would not be productive for the resubmission process. As the GSE’s revamp their 2022-2024 Duty to Serve plans, the rejected plans will be used on an interim basis, the FHFA said. A spokesperson for Freddie Mac said that the company has implemented “innovative solutions” for rural housing, manufactured housing and affordable housing preservation since 2018 through the Duty to Serve program. “We are committed to providing even more impactful support for these underserved markets in our 2022-2024 plan,” a Freddie Mac spokesperson said. A spokesperson for Fannie Mae said its commitment to serve the needs of homeowners and renters in underserved markets has “never been stronger.” “We welcome the opportunity to enhance our DTS Plan with input from FHFA and we will continue our ongoing work to serve these underserved markets,” a Fannie Mae spokesperson said. FHFA's rejection is the culmination of a seven-months long feedback process that included fierce criticism from affordable housing advocates. In May, the GSEs submitted the three-year outline to the FHFA, then under the leadership of Mark Calabria. The process which followed included a formal request for input on the proposed plans and several listening sessions with stakeholders. One stakeholder is affordable housing advocates, and in October twenty such groups — including the National Housing Conference, the National Community Stabilization Trust and the Lincoln Institute of Land Policy — implored FHFA to hit pause on the proposed plans. The proposals, they wrote in a letter, did not meet the "spirit or the letter" of the Duty to Serve regulation. The groups specifically found fault in Fannie and Freddie seeking to eliminate programs to purchase chattel loans, which are manufactured housing loans titled as personal property. They also blasted the GSEs for reducing loan targets for manufactured housing, affordable housing preservation and rural housing. Additionally, affordable housing advocates asked FHFA to make changes to its capital requirements, which they called "overly cautious." Regulations should encourage, not discourage, new program pilots to reach underserved markets, the groups argued. Further, the advocates called a legal interpretation preventing GSEs from making targeted Duty to Serve equity investments "dubious." Jim Gray, now a nonresident senior fellow at the Lincoln Institute of Land Policy, helped stand up and lead the Duty to Serve program at the FHFA. Reached Wednesday, Gray applauded FHFA Acting Director Sandra Thompson's decision to reject the plans. "It's a bold move," Gray said. David Dworkin, president of the National Housing Conference, said the rejection is a great opportunity for GSEs to develop a robust plan that "stretches their capabilities." "The GSEs' obligations to serve underserved markets can be much more robust, and these plans don't do that," Dworkin said. Editor’s note: This story has been updated to include a statement from Fannie Mae. The post FHFA to GSEs: Back to the drawing board on Duty to Serve appeared first on HousingWire. |
| Covius integrates Stavvy for RON and eSign on loan mods Posted: 06 Jan 2022 08:58 AM PST Technology solutions provider Covius announced Tuesday that it is integrating the Stavvy platform into its loss mitigation and loan modification solutions. Covius said that it will use the Stavvy platform to offer RON and eSignature capabilities for all loss mitigation products, regardless of recording requirements. In November 2021, Ginnie Mae announced that it was formally approving the use of eSign and RON on loan modifications, which has made RON capabilities a priority for Ginnie Mae servicers that want to ensure eSignature technology is available on loan modifications requiring county-level recording . Before Ginnie Mae's announcement, only Fannie Mae, Freddie Mac and loans securitized outside of the GSEs were potentially RON-eligible. Together, the service offered by the Covius and Stavvy integration will be able to check for RON eligibility early in the loss-mitigation process. If the loan modification package is found to be RON eligible, Covius will tag the signature lines for eSign and RON recognition, and it will initiate the scheduling process with the borrowers. The digital notarization process will be led by the Covius notary panel and will use Stavvy's technology to notarize the documents in the borrowers' home or office. "The recent announcement by Ginnie Mae represents a significant step forward as these digital channels will now be available to millions of consumers where paper-based processes were previously the only option," Joe Chappell, executive vice president at Covius Settlement Services, said in a statement. "In anticipation of even greater adoption by investors, Covius has proactively aligned with Stavvy, to be ready to offer these options to our large servicer clients." Boston-based Stavvy specializes in eClosings and remote online notarization (RON) services for the mortgage and real estate industry. In May of 2021, Stavvy announced it had received $40 million in Series A funding and was recognized as one of the 2021 HW Tech100 winners for its native eSign and hybrid transaction tools. "Stavvy's mission is to make the completion of complex, legal and financial transactions easier and safer for borrowers throughout the homeownership lifecycle," Shane Hartzler, Stavvy's chief strategy officer, said in a statement. This integration is part of Covius Connected, the company's plan to increase transparency, consistency, performance and ease of integration. The post Covius integrates Stavvy for RON and eSign on loan mods appeared first on HousingWire. |
| Mortgage rates start 2022 with an increase Posted: 06 Jan 2022 07:25 AM PST The average 30-year fixed rate mortgage increased to 3.22% during the week ending Jan. 6, up from 3.11% the week prior, according to the latest Freddie Mac PMMS Mortgage Survey. A year ago, the 30-year fixed rate mortgage averaged 2.65%. This is the second week of mortgage rate increases, after the 30-year fixed rate fell to 3.05% on Dec. 23 amid fears of the Omicron variant. The report is focused on conventional, conforming, fully amortizing home purchase loans for borrowers who put 20% down and have excellent credit. "Mortgage rate increased during the first week of 2022 to the highest level since May 2020 and are more than half a percent higher than January 2021," Sam Khater, Freddie Mac's chief economist said in a statement. "With higher inflation, promising economic growth and a tight labor market, we expect rates will continue to rise. The impact of higher rates on purchase demand remains modest so far give the current first-time homebuyer growth." How local lenders can remain competitive in 2022's changing market As the strong refinance volume of 2020 and 2021 drops industry-wide, lending businesses find themselves at a crossroads: How will they manage the impact of fixed expenses until the next injection of loan volume? Presented by: MaxwellEconomists expect rates to increase in 2022 but will still be close to record-low levels. The Mortgage Bankers Association (MBA) forecasts that 30-year mortgage rates will reach 4% by the end of 2022. Drivers of the rising rates include a more hawkish Federal Reserve, a strongly recovering economy, and large federal budget deficits, according to Mike Fratantoni, MBA's senior vice president of research and industry technology. Rising mortgage rates have already begun to sap demand. According to MBA, mortgage applications fell 2.7% during the two weeks ending Dec. 31. The purchase index fell 32% from two weeks prior, while the refinance index increased 2% during the same time period. The post Mortgage rates start 2022 with an increase appeared first on HousingWire. |
| SitusAMC creating safety net for the private-label market Posted: 05 Jan 2022 01:40 PM PST  SitusAMC subsidiary Securent is expanding its reach into the private-label market with plans to soon introduce a loan-defect insurance product for residential mortgage-backed securities (RMBS) transactions, according to executives from both companies. The initial focus of Securent, which was launched late last year, has been to provide loan-level loan-defect insurance for third-party mortgage originators working in the agency space, the executives said. The company is now preparing to unveil similar coverage for the secondary market with the goal of introducing a private-label insurance product in 2022. Securent's parent company is well-positioned to help it make a successful foray into that largely uncharted insurance market, which is regulated at the state level. SitusAMC, a leading provider of services and technology to the real estate industry, controls some 60% to 70% of the due-diligence loan-review market, according to its CEO, Michael Franco. In terms of competition, Franco added that the private-label market is now largely uncharted territory with respect to loan-defect insurance. "Securent is a live insurance concept that has started working with the agency end of the market but is looking to expand into nonagency side to support both whole-loan trading and [private-label] securitization transactions in 2022," Franco said. "Nobody else has done loan-defect insurance for securitizations yet." Justin Vedder, president of Securent, explained that loan-defect insurance covers most loan-origination errors and omissions. He said that might include cases where income requirements or some other underwriting guideline is miscalculated during the origination process, adding that the insurance would kick in if those defects prompt either a loan default or the inability to sell the loan. Franco added that to get that insurance benefit, loans would require a third-party review. "We are getting licensed in every state," Vedder said, adding that includes meeting the capitalization requirements for operating in each state. "So, it's not cheap to get into the business. "… We have internal resources that have helped us develop a pricing model [for the insurance] that takes into account losses given defaults and economic issues like COVID-19, and we use Moody’s models along with a couple other models — plus some historical purchase data from Fannie Mae and Freddie Mac," Vedder explained. "We combine that all together into a special sauce and that creates a price on a loan-by-loan basis and a pool-by-pool basis." As part of a private-label securitization transaction, hundreds or even thousands of mortgages are pooled, vetted and placed in a trust. Securities backed by the loans are then issued and sold to investors. Vedder, who has two decades of experience in the mortgage-banking and insurance markets, says Securent also is currently in discussions with ratings agencies and RMBS issuers about how the company's loan-defect insurance products can best serve the private-label securitization market. He stressed that SitusAMC and its resources also will be leveraged by Securent because of "all the technology and all the capability and all the expertise they have around the secondary market." Franco declined to comment on the potential premium income that might be generated by Securent in providing loan-defect insurance for the secondary market, though he did say "if premium dollars weren't in the millions, then why do it?" He added that RMBS issuers would purchase the loan-defect insurance coverage for mortgages backing private-label issuances, and the premiums would be funded by proceeds from the securitization deal, "just as attorneys and deal structurers get paid." "The insurance premium would be something that the [mortgage securitization] trust would pay, and that way the insurance would be for the trust's benefit," he added. Securent's efforts to introduce loan-defect insurance in the private-label market also benefits from good timing. The huge boom in single-family mortgage originations in recent years — some $8 trillion worth over the past two years, according to the Mortgage Bankers Association — has fueled double-digit growth of the private-label market based on securitized loan volume. On the other hand, that growth also has created a ripe environment for loan-origination defects. A December report by ACES Quality Management, a technology provider to the financial-services industry, shows the overall "critical defect" rate for mortgage originations in the second quarter of 2021 was 2.27%, up from 2.01% in the prior quarter. The single largest error rate by far, according to the ACES report, was in the category of "income/employment," which accounted for more than 32% of all critical loan defects in the second quarter of last year. The report is based on an examination of post-closing mortgage data from 100,000 unique mortgage-origination records, with defects categorized using Fannie Mae's classification system — or taxonomy. "It has been a hot market," Vedder said. "I'm not blaming anyone, but they [lenders] couldn’t hire fast enough, vendors couldn’t hire fast enough. It was just a complete explosion. "So, you had processors probably doing some underwriting, and people stressed from working so many hours. … So, that’s why you have had so many manufacturing [loan-origination] defects in my opinion." Franco added a hypothetical event to the mix to explain the safety-net benefit of insuring loan pools against critical loan-defect risks. He said that if some lender and RMBS issuer "went sideways," causing the business to fail after the lender had originated a lot of loans with critical defects that are now part of a securitized loan pool, "then the trust [overseeing the loans] has no recourse" for recouping the losses. "But if you have insurance … standing behind the transaction, then you are covered for any manufacturing defects that occurred. … We’re trying to bring a higher level of liquidity and visibility into markets [and] that is healthy overall for more securitization volume on the nonagency side." Adds Vedder: "We’re actively discussing securitizations with Issuers now to decide how to best structure a policy that works to make the most efficient securitization and claims process we can possibly make. We want to make sure all parties win …. and luckily we have great clients that want to work with us to kind of explore and develop this product with us." The post SitusAMC creating safety net for the private-label market appeared first on HousingWire. |
| RMF acquires AAG reverse mortgage servicing portfolio Posted: 05 Jan 2022 10:11 AM PST Reverse Mortgage Funding, LLC (RMF) has acquired a portfolio of mortgage servicing rights (MSRs) and other assets from industry-leading lender American Advisors Group (AAG), which consists of more than 75,000 loans totaling $12.1 billion in unpaid principal balance (UPB). This is according to a communication alert the company sent to its partners which was obtained by RMD. The acquisition is seen as a milestone for RMF, and now positions the company as the top private-sector reverse mortgage servicer in the United States according to the company. Celink will continue to sub-service reverse mortgages in which RMF is the primary servicer. When reached, representatives for RMF declined to comment on the portfolio acquisition. Terms for the deal have not been disclosed. Representatives for AAG provided some additional insight into the transaction, as well as information for borrowers affected by a potential change. "Servicing transfers are a common business transaction in the mortgage industry," an AAG spokesperson told RMD. "The MSR transfer impacts most AAG reverse mortgage loans that funded through May 31, 2021. The transfer does not alter the terms of the loans or interrupt the servicing of those loans. Customers whose loans have been transferred were notified mid-November about the transfer and can call 1-833-801-0680 with any questions."  Additionally, recently-appointed AAG President and COO Ed Robinson described the transaction as one which will allow the company to make greater investments in the customer experience. "This transaction will facilitate AAG making disciplined investments into the core of our business, namely: technology, expansion of key initiatives, and the customer experience, as our customers are the heart and soul of what drives us at AAG," he said. RMF credits the relationship the company maintains with Starwood Investment Group as a key driver of the company's investment activity in the reverse mortgage space. In December 2019, RMF parent company Reverse Mortgage Investment Trust (RMIT) announced that it agreed to be acquired by an affiliate of Starwood, a global private investment firm that is focused on real estate investments, and which maintains more than $60 billion of assets under management. The Starwood affiliate completed the acquisition of RMIT/RMF in January 2021, and it was made clear that Starwood plans to position RMIT and RMF for greater levels of growth. Starwood was encouraged by the increasing prevalence of proprietary reverse mortgage products according to RMIT Chairman and CEO Craig Corn upon the original announcement of the acquisition. "This is an exciting opportunity for RMIT/RMF, as Starwood can be the catalyst to help accelerate our growth," Corn said at the time. "Over the last few years, Starwood has been an innovator in non-agency mortgages, helping grow the industry into the success it is today. Starwood believes the private reverse mortgage sector has a similar opportunity for growth and believes RMF is the perfect platform to help expand the market." RMF has made several notable reverse mortgage portfolio purchases in the past from other lenders. In late 2018, RMF acquired a $4 billion portfolio from now-defunct reverse mortgage lender Live Well Financial, an acquisition that placed RMF as the owner of the largest Home Equity Conversion Mortgage (HECM)-backed Securities (HMBS) issuance portfolio industry-wide at the time. More than three years prior to the Live Well purchase, in May 2015, RMF acquired the reverse mortgage portfolio from Sun West Mortgage Company, which consisted of reverse mortgage servicing rights totaling $1.8 billion – the complete portfolio amount of Sun West's previous holdings, as noted in Ginnie Mae data from earlier that year. The post RMF acquires AAG reverse mortgage servicing portfolio appeared first on HousingWire. |
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