Americans could soon face another increase in borrowing costs as the Federal Reserve prepares for a highly anticipated interest rate decision. Financial markets widely expect policymakers to raise the federal funds rate by a quarter percentage point, a move intended to combat renewed inflation pressures but one that could also make credit cards, auto loans, and certain home loans more expensive.
Americans waiting for the housing market to become more affordable may have to remain patient. Mortgage rates are now expected to stay elevated through much of 2027, while home prices could continue rising modestly, creating another difficult year for prospective buyers hoping that lower borrowing costs will make homeownership easier to achieve.
The mortgage industry is approaching one of its most significant appraisal changes in more than a decade as Fannie Mae and Freddie Mac move toward full implementation of the Uniform Appraisal Dataset 3.6 and redesigned Uniform Residential Appraisal Report. The transition will change far more than the appearance of appraisal reports. For lenders, underwriters, appraisal management companies, and technology providers, UAD 3.6 introduces a more structured, data-driven approach to ordering, reviewing, and submitting residential appraisals.
Buying a condominium may soon become more challenging for many homebuyers as new lending standards introduced by Fannie Mae and Freddie Mac increase the level of scrutiny applied to condominium projects. Mortgage professionals say the updated requirements are intended to strengthen the financial and structural integrity of condo communities, but they also warn the changes could lead to longer approval timelines, additional documentation requests, and more loan denials for buyers seeking conventional financing.
The U.S. housing market is showing additional signs of slowing as homebuilders scale back new single-family construction in response to elevated mortgage rates, higher construction costs, and softer buyer demand. Although the nation continues to face a long-term housing shortage, many builders are becoming increasingly cautious about launching new projects until affordability improves and consumer confidence strengthens.
The Federal Housing Finance Agency (FHFA) has proposed a rule to add public disclosure requirements for the Enterprise Regulatory Capital Framework (ERCF) for Fannie Mae and Freddie Mac. The proposed rule would implement quarterly quantitative and qualitative disclosure requirements for the enterprises related to regulatory capital instruments, risk-weighted assets calculated under the ERCF’s standardized approach, and risk management policies and procedures.
Opinion-Editorial (Op-Ed) Disclaimer For NAMU® Library Articles: The views and opinions expressed in the NAMU® Library articles are those of the authors and do not necessarily reflect any official NAMU® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMU®. Nothing contained in this articles should be considered legal advice.
Fannie Mae and Freddie Mac reported earnings declines from the second to third quarter of 2021, but both experienced increases in year-over-year earnings. Fannie Mae announced that its net income for the quarter was $4.8 billion, down from $7.2 billion during the second quarter of 2021. The company booked net income of $4.3 billion in the third quarter of 2020.
Opinion-Editorial (Op-Ed) Disclaimer For NAMU® Library Articles: The views and opinions expressed in the NAMU® Library articles are those of the authors and do not necessarily reflect any official NAMU® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMU®. Nothing contained in this articles should be considered legal advice.
Fannie Mae economist expect mortgage originations to remain above pre-pandemic levels in 2022. The company’s Economic and Strategic Research Group released its latest commentary this week, in which it revised downward its full-year 2021 projection for GDP growth for the third consecutive month.
Opinion-Editorial (Op-Ed) Disclaimer For NAMU® Library Articles: The views and opinions expressed in the NAMU® Library articles are those of the authors and do not necessarily reflect any official NAMU® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMU®. Nothing contained in this articles should be considered legal advice.
August was a decent month for the housing and mortgage markets following a few slower months earlier this summer. Freddie Mac reported this week that its total mortgage portfolio increased at an annualized rate of 23.7 percent in August. The ending balance for the portfolio was $3.093 trillion, compared with $2.576 trillion a year ago.
Opinion-Editorial (Op-Ed) Disclaimer For NAMU® Library Articles: The views and opinions expressed in the NAMU® Library articles are those of the authors and do not necessarily reflect any official NAMU® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMU®. Nothing contained in this articles should be considered legal advice.
The Federal Housing Finance Agency (FHFA) has proposed amending the Enterprise Regulatory Capital Framework (ERCF) for Fannie Mae and Freddie Mac. The proposed amendments, released last week, would refine the prescribed leverage buffer amount (PLBA) and the capital treatment of credit risk transfers (CRT).
Opinion-Editorial (Op-Ed) Disclaimer For NAMU® Library Articles: The views and opinions expressed in the NAMU® Library articles are those of the authors and do not necessarily reflect any official NAMU® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMU®. Nothing contained in this articles should be considered legal advice.
Fewer first-time homeowners and buyers of newly constructed homes are relying on FHA financing. According to a recent blog post by the National Association of Home Builders (NAHB) based on U.S. Census data, more than 76 percent of new home sales in the second quarter of this year were financed with conventional loans.
Opinion-Editorial (Op-Ed) Disclaimer For NAMU® Library Articles: The views and opinions expressed in the NAMU® Library articles are those of the authors and do not necessarily reflect any official NAMU® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMU®. Nothing contained in this articles should be considered legal advice.
The Federal Housing Finance Administration (FHFA) has established higher low-income housing goals for Fannie Mae and Freddie Mac over the next three years. FHFA announced the new benchmarks for mortgage purchases by the GSEs last week. In the same announcement, FHFA introduced two new single-family home purchase subgoals to replace the existing low-income areas subgoal.
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Fannie Mae and Freddie Mac doubled their year-over-year net income during the second quarter of 2021. Fannie’s net income for the quarter was $7.2 billion, an increase of 181 percent over the $2.5 billion net income in the second quarter of 2020. The company’s recent quarter also produced a 43 percent increase over the $5 billion booked in the first quarter of 2021.
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To stay busy, mortgage underwriters and mortgage processors need people to buy houses. For that to happen, the real estate market needs to provide enough inventory to meet demand. As anybody in the mortgage and real estate industries can attest, that hasn’t been the case lately.
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In the housing market, there continues to be growing optimism regarding selling a home and more pessimism about buying. Fannie Mae released its latest monthly Home Purchase Sentiment Index last week. The survey found that 64 percent of respondents thought the current environment makes it a bad time to buy a home, up from 56 percent the previous month.
Opinion-Editorial (Op-Ed) Disclaimer For NAMU® Library Articles: The views and opinions expressed in the NAMU® Library articles are those of the authors and do not necessarily reflect any official NAMU® policy or position. Examples of analysis performed within this article are only examples. They should not be utilized in real-world application as they are based only on very limited and dated open source information. Assumptions made within the analysis are not reflective of the position of NAMU®. Nothing contained in this articles should be considered legal advice.
Written By: Stacey Sprain
As an FHA originator, processor or underwriter, it’s likely that in the ongoing foreclosure market you’ll run across a HUD REO loan at some point. The purpose of this multi-part article is to provide you with some useful information to help in your endeavors.