The latest economic and policy trends facing mortgage servicers

Join this webinar for an in-depth roundtable discussion on economic and policy trends impacting servicers as well as a look ahead at strategies servicers should employ in the next year.

2021 RealTrends Brokerage Compensation Report

For the study, RealTrends surveyed all the firms on the 2021 RealTrends 500 and Nation’s Best rankings, asking for annual compensation data for the 2020 calendar year.

Steve Murray on the importance of protecting property rights

In this episode, Steve Murray, RealTrends advisor and industry stalwart, discusses some of the issues facing private property rights, including how a case in Germany could potentially affect U.S. legislation.

Lenders, it’s time to consider offering non-QM products

The non-QM market is making a comeback following a pause in 2020. As lenders rush to implement, Angel Oak is helping them adopt these new lending products.


Housing’s critical problems are “intrinsic to the GSE charters”

Private capital at the center of reform

Private capital is the cornerstone of the housing reform movement, as the U.S. Treasury and other housing regulators push for more reform to ensure that the financial crisis will never occur again, at least not at the same level.

Michael Stegman, counselor to the secretary for housing finance policy with the Treasury, said at the Goldman Sachs (GS) Housing Finance Conference Thursday morning, that the current status quo is unsustainable and taxpayers are still on the hook.

“The critical flaws in the legacy system that allowed private shareholders and senior employees of the GSEs to reap substantial profits while leaving taxpayers to shoulder enormous losses cannot be fixed by a regulator or conservator because they are intrinsic to the GSEs’ congressional charters,” Stegman said.

“And these charters can only be changed by law. That is why we continue to believe that comprehensive housing finance reform is the only effective way forward, not narrowly crafted ad-hoc fixes,” he added.

Since Fannie Mae and Freddie Mac went into conservatorship, their investment portfolios have been nearly halved, and they are required to shrink further to less than $500 billion in total by year-end 2018.

In order to get to this point, Stegman explained that the Federal Housing Finance Agency is laying the groundwork for a future housing finance system based upon private capital taking the majority of credit risk in front of a government guarantee with greater taxpayer protections, broader access to credit for responsible borrowers and improved transparency and efficiency.

While there is a lot of debate over the future of the government-sponsored enterprises, Stegman said that their reform would not be wise or feasible within the existing frameworks that includes their flawed charters, conflicting missions, and virtual monopolistic access to a government support.

“As we have said repeatedly, the only way to responsibly end the conservatorship of the GSEs is through legislation that puts in place a sustainable housing finance system with private capital at risk ahead of taxpayers, while preserving access to mortgage credit during severe downturns,” said Stegman.

On the side of recapitalization of Fannie and Freddie while in in conservatorship and subsequent privatization, Stegman argued that if in the future the GSEs were to operate as they did prior to conservatorship, the GSEs’ size and significance would certainly attract broad regulatory attention due to the financial stability implications of their possible failure.

“Given this and the associated economic and regulatory ramifications, simply returning these entities to the way they were before is not practical nor is it a realistic consideration,” he said.

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