Listen to this week's market update from yesterday's podcast: http://lykkenonlending.com/2017-12-11-podcast-market-update-with-joe-farr/
Listen to this week's edition of Lykken on Lending for the latest mortgage rate and market updates.http://lykkenonlending.com/2017-11-27-podcast-market-update-with-joe-farr/
MBSQuoteline is pleased to announce two new features to its real-time mortgage market information service. These new features will significantly enhance its value to secondary marketing professionals. Ginnie Mae II 30 yr mortgage-backed securities (MBS) prices are now available. With the vast majority of all newly issued Ginnie Mae MBS now being Ginnie Mae IIs, this new feature will be extremely helpful. In addition, MBSQuoteline now provides three forward months of Fannie Mae, Freddie Mac, and Ginnie Mae I TBA prices. Two forward months of prices are standard with a subscription to MBSQuoteline, but at times you really need to have the third month’s prices. These two additional features farther separate MBSQuoteline from its competition as the most complete, most affordable service for those in secondary marketing. To learn more about MBSQuoteline go to www.mbsquoteline.com to start a free trial or call us at (512) 343-0003 to activate these two add-on features.
We have received a few questions today about why mortgage-backed securities (MBS) prices do not show the same drop in prices as seen from the Fannie Mae window. The reason is that Fannie Mae, this morning, built into their whole loan prices an increase in their required guarantee fee (G-fee). Since G-fees are paid from the borrower's loan rate and not by the owner of an MBS, MBS prices are unaffected by a change in G-fees. Most lender rate sheets began reflecting the increase in G-fees over the last few weeks, depending on lock term and delivery method.
Is your company one of the many looking into selling their mortgage loan originations on a servicing retained basis? If so, the Lykken on Lending show today is one to which you should listen. Servicing experts Austin Tilghman and David Stephens, from United Capital Markets, were guest speakers. They explained that economics have forced many former release shops to consider retaining servicing. With so many correspondent lenders out of the market or having curtained their volume, there is very little competition for loans and as a result the correspondents are not having to pay full value for servicing. Even though the economics may compel originators to retain servicing, there are several complicating factors to be considered before doing so. One should consider the time it takes to become approved as a servicer with the agencies, the need to acquire sufficient net worth to qualify, employing servicing knowledge, and adapting to the changing cash flows of your business. Other non-economic risks need to be understood in making a decision to retain servicing, including the significant regulatory uncertainty surrounding servicing and that there is an unclear secondary market for servicing rights in the future. What is clear is that the servicing cash flows [...]
Our special guest on the Lykken-on-Lending blog talk radio show today was Doug Duncan, the Chief Economist for Fannie Mae. Doug provided his thoughts on the economy, housing, Europe, and inflation, but the most interesting comments had to do with his answer to a question asking how he would characterize what will happen in 2012. Doug answered by directing the listeners to a Fannie Mae research paper entitled 2012 – Year of the Political Economy. This paper can be found on the Fannie Mae web site at http://www.fanniemae.com/portal/about-us/media/financial-news/2012/5609.html. Doug explained that 2012 will be very heavily effected by the number of regulations just added to the books, as well as the many new regulations to be issued in the months to come. The consequence of the huge number of new regulations is UNCERTAINTY. He estimates that uncertainty will cost the economy 1% in Gross Domestic Product or $500 to $750 billion in 2012, effecting both the consumer and businesses. Click PLAY to listen to the podcast of this week’s BlogTalkRadio/Lykken on Lending with Dave Lykken and MBSQuoteline's Joe Farr: Listen to internet radio with David Lykken on Blog Talk Radio MBSQuoteline supplies the essential market information necessary for effective decision making [...]
On Friday, President Obama signed into law the Temporary Payroll Tax Cut Continuation Act. This Act uses increased guarantee fees on new mortgages to pay for reduced payroll taxes. The amount of the g-fee increases will be included in future mortgage rates. Below are general provisions pertaining to increasing the Guarantee Fees for Fannie, Freddie, and FHA. Several elements in the bill are not quite clear and may take weeks or months to determine. The primary questions are: 1. How much will the Fannie and Freddie g-fee rise? The Act calls for a minimum increase of 10 basis points, but the amount of the increase is to be determined by FHFA and is supposed to a)"cover the risk of loss associated with the guarantee", and b) be based on "the cost of capital allocated to similar assets held by other fully private regulated financial institutions". This definition could result in a wide range of fee increases. The early expectation from insiders is that the increase will be 10 basis points. 2. When will the increase become effective? The Act says the increase is to be applied to guarantees issued after enactment of this section. The date this provision is to [...]