Reverse

Ginnie Mae announces Platinum product for reverse mortgage-backed securities

New program may increase liquidity in HMBS market
Ginnie Mae has launched a new securitization channel for reverse mortgage-backed securities. Now, investors in the HECM mortgage-backed securities market can participate in Ginnie’s new Platinum HMBS program, which reduces the administrative costs of holding multiple and smaller HMBS securities and promises to bring more liquidity to the market.
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Ditech says its reverse mortgage business is unprofitable

With continued losses likely, the struggling nonbank says it's weighing its options
Aware that sweeping regulatory changes would likely send the reverse mortgage business into a tailspin, Ditech – then named Walter Investment Management – shut down the HECM origination channel of its subsidiary, Reverse Mortgage Solutions, in 2017. But the company has continued to service reverse mortgages, and it’s not going well. According to a report filed Tuesday with SEC, Ditech's reverse mortgage business is operating at a sizable loss – and this trend isn’t likely to turn around anytime soon.
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WTH is a reverse mortgage?

So many consumers think they're a scam. Here's the truth.
Reverse mortgages may be the most misunderstood – and the most maligned – financial product out there. But for those who are certain they are simply a scam, shrug off your perceptions for a moment and consider this: Would the U.S. government really endorse a scam for the last 30 years? Not likely. While unforeseen problems with the loan have largely been resolved, the sour scent of foul play lingers. To clear the air, here is a list of facts curated specifically to address the questions of what, exactly, is a reverse mortgage.
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More countries promote reverse mortgage-like programs

Hong Kong and Malta work on their own equity-release products
Reverse mortgages are finding some traction abroad as more countries adopt and tweak equity-release programs designed to allow seniors to access their home's equity. Recently, the tiny Mediterranean island of Malta announced the pending launch of an equity-release program for retirees, while Hong Kong announced changes to its program to allow borrowers to relocate without defaulting. These developments highlight the fact that policymakers across cultures recognize the potential solution equity access presents as the global population continues to age.
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Lender margins on reverse mortgages are finally making a comeback

Data suggests lenders are adjusting to a new normal after a rough 2018
Margins on adjustable-rate reverse mortgages have continued to inch higher after a nine-month descent that began last March, suggesting that perhaps the industry is beginning to recover after a rough year and a half. According to Baseline Reverse’s Dan Ribler, margins are trending upward and lenders are feeling a bit more positive about the business.
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These two catalysts could spark a surge in home equity use

Here's how low interest rates and a wave of tech IPOs could affect the housing market
This year, two geysers of pent-up wealth are set to erupt, and the ripple effect just might inspire more homeowners to utilize their home equity. That's the theory proposed by Bloomberg columnist Conor Sen in a recent op-ed, in which he examines the possibility that U.S. homeowners might once again embrace debt and leverage now that memories of the financial crisis are beginning to fade. Will 2019 be the year of equity access?
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These are the top issuers of reverse mortgage-backed securities

New View Advisors names biggest players, details low Q1 volume
As reverse mortgage loan production steadily declines, so too has the issuance of the securities backed by this product on the secondary market. Issuers of HECM-backed securities, or HMBS, brought just under $1.7 billion to market in the first quarter of 2019, according to the latest report from New View Advisors. This is a 44% decline from last year and the lowest total in five years.
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More borrowers are raising their mortgage rate to cash out equity

Cash-outs comprise greatest share of refinances since 2006 peak
For several months now, cash-out refinances have been eating up a greater share of overall refi volume, and it appears the trend isn't about to slow down anytime soon. The latest report from Black Knight reveals that 82% of refinances originated in Q4 2018 were cash-outs, and that in two-thirds of these transactions, the borrower raised their mortgage rate in order to access their equity in cash.
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Will sale-leasebacks change how homeowners tap into their equity?

Figure Technologies says it has a better solution than reverse mortgages and HELOCs
In just its second year of operating, Figure Technologies has already raised more than $120 million in capital. While at the LendIt Fintech conference in San Francisco this week, I sat down with TJ Milani, Figure's VP of finance and strategy, and Patrick Silberstein, senior director of capital markets, to discuss the company's strategy behind its sale-leaseback product and its plans to disrupt the home equity market.
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