Are record-low interest rates masking high-cost mortgage lending?

Are record-low interest rates masking high-cost mortgage lending?

Five leading economists weigh in and the answer may surprise you

Auction.com partners with Google to predict housing trends

Nowcast will predict in real time

The New York Times rambles, and mangles mortgages along the way

Mortgage finance and mortgage regulation aren’t the paper’s strong suits
W S
Servicing / The Ticker

Ginnie Mae reevaluates nonbank rules

Prepares for future distress

life rafts
/ Print / Reprints /
| Share More
/ Text Size+

Ginnie Mae President Ted Tozer noted in a Bloomberg article that since the company increasingly relies on nonbank mortgage companies, he is evaluating if they have enough easy-to-sell assets to survive in times of distress. 

The U.S.-owned company, which guaranteed the first mortgage-backed security in 1970, now backs $1.5 trillion of debt. It may increase liquidity requirements for the firms that issue and service Ginnie Mae bonds to protect its profits and taxpayers from losses, Tozer said in a phone interview this month.

“Basically every default we’ve had was due to the issuer running out of cash,” said Tozer, 57, a former National City Corp. executive who became Ginnie Mae’s head in 2010. “We’re evaluating it right now.”

This follows reports that nonbanks are experiencing a strong year, with investment banker and outspoken housing analyst Christopher Whalen, predicting that by this time next year, 40% of mortgage originations will be done by nonbanks.

Source: Bloomberg
Read full story

Recent Articles by Brena Swanson

Comments powered by Disqus