Great News!...? FHA Will Start Taking Loans in Forbearance, but Not All of the Risk
Published June 15, 2020
Loans that were originated according to FHA guidelines – that went into forbearance before they were able to be move them over to FHA – are now able to be insured by the FHA. There are, of course, some restrictions and stipulations that are associated [...]
Time to Start Thinking About Getting Conventional Loans Out of Forbearance
Published May 29, 2020
As we head into June, it feels like the eye of the storm in the mortgage industry. Forbearances are still increasing but at a greatly diminished rate, rates are still low, volume is still high, many states have begun to reopen, and the secondary market has [...]
Mortgage Volumes Still Strong Despite Economic Uncertainty
Published April 23, 2020
During these unprecedented times, we are all trying to stay safe and healthy. Among other measures, this means a lot of social distancing and time spent in your current place of residence. The purchase market is slowing as both supply and demand are [...]
Downside Risks in the Mortgage Market
Published April 7, 2020
The COVID-19 pandemic is not a housing crisis in its nature, but there are several places throughout the industry where the pandemic or policy response to it has hit at some vulnerabilities in the market. For the most part, these vulnerabilities tend to [...]
The CARES Act and its Impact on the Economy and the Mortgage Market
Published April 3, 2020
There are two primary concerns for the mortgage industry in regard to the pandemic: one is the secondary market losing liquidity and the primary market drying up; the other is the possibility that the pandemic will cause a wave of unemployment and lack of [...]
Recent Actions Taken in Response to the COVID-19 Pandemic
The Federal Reserve (FED) has had a busy past few weeks. Since lowering the Fed Funds Rate1 and announcing their first Quantitative Easing (QE)2 actions of this crisis, they have taken several other actions to maintain liquidity and confidence in the economy. Many of these [...]
Emergency Actions in Response to COVID-19 & the Implications of the Policy Actions
In response to the COVID-19 (Coronavirus Disease 2019) pandemic, global economic conditions, and the economic uncertainty that social isolation protocols have induced, the Federal Reserve Open Market Committee (FOMC) just made its second emergency rate cut over the past two [...]
Market Commentary: The Impact of Rate Movement and Loan Characteristics on Servicing Value
In terms of the secondary market, a mortgage loan is essentially made up of two separate parts, the loan asset and the servicing asset – which may be split up, packaged, and sold separately. The largest of the two pieces is the loan asset, which is cashflow of the loan itself, [...]
Market Commentary: The Impact of Rates, Seasonality, and Appreciation on Mortgage Volumes
Mortgage originations are booming! While this is primarily fueled by the most recent refi boom, there are other aspects to this that, right now, are also favorable and adding fuel to the fire. The loan purpose is one of the main determinants of how volume will be affected by [...]
Market Commentary: The Impact of Low Rates on Lender Profitability
Consider the direct impact of our recent favorable rate trend on lender profitability. In the paragraphs below, we examine how lower mortgage rates can equate to higher margins for lenders as seen through the primary-secondary spread.