 | | | | By Paul Muolo pmuolo@imfpubs.com The volume of mortgages subserviced for others declined slightly in the second quarter, but the sector still faces bright prospects as many firms contemplate outsourcing the processing chore to specialists that can effectively handle an increasing array of compliance regulations. The nation’s three largest subservicers – Dovenmuehle, Cenlar and PHH Mortgage – had a combined subservicing market share of 55.8 percent at June 30, dominating the sector, according to exclusive survey figures compiled by Inside Mortgage Finance. On a sequential basis, Dovenmuehle grew its business by 2.3 percent, Cenlar by 2.4 percent, and PHH by 3.9 percent. Unlike the other two, PHH over the past year has been selling mortgage servicing rights while continuing to subservice the loans. The nation’s 15 largest subservicers had combined contracts of $700.8 billion at midyear, or about 8.9 percent of outstanding home mortgages in the U.S. For more details and an exclusive ranking of the nation’s largest subservicers, see Inside Mortgage Finance. Other areas of interest: Servicing, Data/Rankings, Trends & Profitability | | By Brandon Ivey bivey@imfpubs.com Two Harbors Investment is preparing to issue a $374.34 million jumbo MBS that is dominated by retail-originated purchase loans. The average seasoning for the collateral is two months, according to a presale report issued by DBRS. Retail originations account for 71.8 percent of the loans in the Agate Bay Mortgage Trust 2014-2 filing. Almost 70 percent are purchase mortgages. A number of lenders included in the deal tout that they only have retail programs. Mortgage Master, the top contributor to the MBS with a 14.8 percent share, primarily focuses on retail originations, though the lender does some correspondent and broker business. Two other major contributors to the deal, George Mason Mortgage – a subsidiary of Cardinal Bank – and American Pacific Mortgage, are retail-only shops. DBRS is requiring an AAA credit enhancement of 7.40 percent on the deal. The bond rating agency increased credit enhancement requirements on the security due to concerns about weak financials and/or limited non-agency securitization history for some of the lenders in the deal. Other areas of interest: Originations, Secondary/MBS, Nonconforming | | By George Brooks gbrooks@imfpubs.com Assistant Housing Secretary Carol Galante and three of her predecessors said they support spinning out the FHA from the Department of Housing and Urban Development to become an independent, self-funding federal mortgage insurer. Discussing the future of the agency at a housing forum hosted by the Bipartisan Policy Center, Galante and ex-FHA commissioners David Stevens, Brian Montgomery and Nicolas Retsinas all agreed that their biggest challenge during their tenures was dealing with the annual appropriations process. With Congress in charge of HUD's purse strings, obtaining additional money for new hires and projects can be difficult. Stevens, who led the FHA for part of the financial crisis, recalled difficult times dealing with policymakers and appropriators. “The FHA needs a self-funding mechanism,” said the current president of the Mortgage Bankers Association. For further analysis on the topic, see the upcoming edition of Inside Mortgage Finance. Other areas of interest: Originations, Regulatory, Ginnie Mae/FHA | | By Charles Wisniowski cwisniowski@imfpubs.com Time is not a friend to the housing finance system so long as Fannie Mae and Freddie Mac remain in government conservatorship with no endgame in sight, according to the man who used to be their regulator. In one of his first public speeches since leaving the agency this spring, former FHFA Acting Director Edward DeMarco told attendees at the Bipartisan Policy Council’s housing summit in Washington that the GSEs’ ongoing conservatorships – now six years old – will continue to distort the market and place taxpayers at risk. “The conservatorships are a huge barrier to entry for private capital,” said DeMarco. “The more we wait, the more [we risk] that private capital is going to lose interest and move to other sectors that offer more inviting opportunities.” Former Federal Housing Finance Board Chairman Bruce Morrison agreed. “There is no such thing as standing still. Decisions or non-decisions have consequences,” he said. Morrison said policymakers should reduce the profitability of the GSEs while doubling down on their risk-sharing initiatives. Last month DeMarco accepted a position as a senior fellow in residence at the Milken Institute’s Center for Financial Markets. Other areas of interest: Originations, Servicing, Secondary/MBS, Regulatory, Fannie, Freddie | | By Paul Muolo pmuolo@imfpubs.com AmeriSave Mortgage – which has been in the hunt for acquisitions all year – has finally landed one. Early this week, the Atlanta-based lender agreed to buy the mortgage banking division of the struggling CertusBank for an undisclosed sum. CertusBank entered the mortgage business two years ago when it bought Myers Park Mortgage. The Charlotte-based bank made headlines this spring when it fired three top executives for spending millions of dollars of the bank’s money on corporate condos and private jet flights. AmeriSave, a nonbank, has not been without controversy itself. A few months back, the Consumer Financial Protection Bureau slapped the lender and an affiliate with $19.3 million in fines and damages for engaging in what the regulator called a “deceptive bait-and-switch” scheme tied to the rates it posted online. CertusBank also is selling its wealth management division. Other areas of interest: Originations, Mergers & Acquisitions, Mortgage Lending & Servicing | | By Paul Muolo, George Brooks pmuolo@imfpubs.com, gbrooks@imfpubs.com From what we understand, the Mortgage Electronic Registration System, commonly known as MERS, is not for sale, though there have been press reports that the mortgage tech vendor is talking to the Intercontinental Exchange about some type of business partnership. Keep in mind that MERS’ largest shareholders include Fannie Mae and Freddie Mac. Some GSE observers point out that the Federal Housing Finance Agency’s efforts to streamline and reduce costs at Fannie and Freddie could eventually result in the two selling their stakes… Another large shareholder in MERS is the Mortgage Bankers Association, which a few years back made a very bad bet on commercial real estate in Washington, DC. The trade group built a new headquarters in the nation’s capital during the recession, couldn’t rent out the empty floors, and sold the building at a huge loss. “They [MBA] could definitely use the money,” said one technology advisor close to MERS… The MBA wants the FHFA to push Fannie and Freddie to go easy on mortgage buybacks. In a new comment letter concerning the agency’s “strategic plan,” MBA notes that many repurchase requests “were based on technical foot-fault defects” and “in many cases resulted from unreasonable or erroneous decisions by the GSEs themselves”… MORTGAGE DATA POINT: The FHA’s second-quarter average credit score of 680 was 3 points below the previous quarter’s score and 13 points below the score during the same period last year. MORTGAGE PEOPLE: Due diligence provider Clayton Holdings has hired John Maco as senior managing director of business development. Maco, who will report directly to Tom Donatacci, Clayton’s executive vice president of sales and marketing, joins the company from Oversite Data Services, where he served as senior vice president of sales.
We love data IMF has been collecting mortgage industry data for 30 years. From this we publish thousands of pages of accurate, reliable industry market statistics each year. But there’s so much more that doesn’t normally make it out of our databases. If you need some market data that isn’t available through the Mortgage Data menu on our web site, or need additional information on one of the sets that is there, we also conduct custom-data projects. For more information, check in with our custom-data authority, Gwen Jones. Other areas of interest: Originations, Servicing, Secondary/MBS, Regulatory, Fannie, Freddie, Technology | | | |
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