Archive for September, 2010
Today's weekly mortgage applications survey from the Mortgage Bankers Association seemed to offer a small glimmer of hope.
Government purchase applications have been driving the market for the past year, accounting for, at times, nearly half of all new loans.
Yes, refinancings—which have been running at around 80 percent of all mortgage applications—fell despite a new record low average rate on the 30-year fixed of 4.38 percent.
Not so good.
But on the other hand, purchase applications rose 2.4 percent, largely driven by a 4.5 percent increase in government purchase applications (FHA).
Great, except for that last part.
Despite the overwhelming evidence provided by Fannie Mae and Freddie Mac that mortgage guarantees can be a very dangerous business, they continue to remain the "solution" to the future of housing finance Congress leans towards. In a House Financial Services Committee hearing today, of the nine witnesses testifying only one explicitly speaks out against some form of federal guarantees. Meanwhile, seven say they're the best answer and one remains agnostic.
Who are these witnesses? They include
* A mortgage banker (Mr. Michael J. Heid, Co-President of Wells Fargo Home Mortgage and Chairman of the Housing Policy Council of The Financial Services Roundtable)
* 2 financial services lobbyists (The Honorable Kenneth E. Bentsen, Jr., Executive Vice President, Public Policy and Advocacy, Securities Industry and Financial Markets Association, Mr. Tom Deutsch, Executive Director, American Securitization Forum)
* 2 business school professors (Phillip L. Swagel, McDonough School of Business, Georgetown University; Susan Wachter, The Wharton School, University of Pennsylvania)
* An affordable housing advocate (Mr. Michael Bodaken, President, National Housing Trust)
* An economist think-taker (Mr. Christopher Papagianis, Managing Director, Economics21)
* An real estate investor (Mr. Michael A.J. Farrell, Chairman, Chief Executive Officer and President, Annaly Capital Management, Inc.)
* A former Fannie Mae credit officer (Mr. Ed Pinto, Real Estate Financial Services Consultant)
Can you guess which one is against government guarantees? The only one with actual experience with them: former Fannie Mae credit officer Ed Pinto. The economist doesn't take a stand, but outlines the pros and cons. The banker, investor, lobbyists, academics, and affordable housing advocate all favor the government guarantees. The only witness who speaks against guarantees also happens to be the only one who has seen them in action first-hand.
The failure of Anglo Irish bank, the lender at the centre of the country’s financial crisis, would “bring down” Ireland, the country’s finance minister said, as he vowed the government would stand behind the institution.
Dublin will on Thursday unveil a fresh recapitalisation of Anglo Irish and seek to draw a line under its banking crisis.
Jeff Zuckerman recently joined MIAC, a research analytics firm, as vice president of software sales. He will based at the Maiden Lane office and will report to Sachit Kumar, managing director of Capital Markets Group.
Zuckerman previously worked at Standard & Poor's, leading sale efforts in analytics and data for structured finance securities, with a focus on RMBS and CDO investors, structuring groups and U.S. government entities. Before that, he worked in business development at the RVI Group, where he led the firm's efforts to enter the Auto Lease Securitization space as a residual guarantor.
MIAC provides analytical solutions for mortgage originators, servicing hedgers and portfolio managers. The firm has been active in the US mortgage analytic space for over twenty years.
Write to Christine Ricciardi.
Calyx Software and Loan-Score Decisioning Systems are integrating their respective loan origination system and automated underwriting system on Friday, to offer users access to automated pricing and underwriting for each investor and eligibility standards associated with the Federal Housing Administration.
The new functionality is tied in with Calyx Point, the current Calyx origination program, and was released to already registered users earlier this month. Loan-Score's product and pricing engine as well as its automated underwriting system will be accessible through the Point user interface to everyone else on Friday.
“Our integration with Calyx is one of the most strategic initiatives we’ve taken to capture market share,” said David Colwell, executive vice president of Loan-Score. “Embedding our Web-based application in Point provides Calyx users access to our comprehensive decisioning platform."
Without leaving the Calyx Point program, users can interact with Loan-Score, receiving price quotes and automated underwriting pre-approval. Users can also access the FHA TOTAL Scorecard through Loan-Score, which helps lenders evaluate credit risk associated with an origination.
Calyx is a mortgage solutions provider to banks, credit unions, mortgage bankers and brokers. Loan-Score provides a decisioning platform for lenders that includes a product and pricing engine, a portfolio analysis engine, an automated underwriting system and a channel-focused point-of-sale. Both companies are based in California.
Write to Christine Ricciardi.
Attorney General Martha Coakley may become the latest to jump into the burgeoning controversy over allegations of assembly-line style foreclosures at major mortgage industry loan servicers.
These are firms that are servicing mortgages originated by other lenders, including pushing forward with foreclosures when homeowners fall behind on their payments.
At issue are revelations that a GMAC Mortgage employee signed off on thousands of foreclosure documents without checking their accuracy. The GMAC middle manager has owned up to signing 10,000 foreclosures a month. That's 500 a day, or one per minute. How reassuring is that?
A spokeswoman for Coakley's office told me yesterday our AG is exploring the issue, but as a practice does not comment on whether a formal investigation has been launched.
