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Fannie Addresses Layered Risk High DTIs


A growing share of loans with high debt-to-income ratios and other high risk factors has recently concerned mortgage insurers and prompted a policy change at Fannie Mae.

The trend began last summer as Washington-based Fannie started allowing low-down payment mortgages to borrowers who had DTI ratio's as high as 50 percent.

Mortgage insurance companies began to notice that too many borrowers were being approved who exhibited additional risks factors such as weak credit scores and inadequate reserves.


M.I. Firms Warn About Freddie Pilot


The nation's mortgage insurance companies are warning about a new pilot program that enables Freddie Mac to bypass traditional mortgage insurance.

The McLean, Virginia-based secondary mortgage lender has launched a pilot program known as Integrated Mortgage Insurance, or IMAGIN.

A newly created U.S. subsidiary or Hamilton, Bermuda-based Arch Capital Group LTD -- Arch MRT -- has agreed to insure Freddie then transfer 100 percent of the risk to re-insurers.


Refi Share Wider Despite Record Low Rate-Term


A modest weekly drop in new mortgage business was led by adjustable-rate mortgages. Government share widened, as did refinance share thanks to a gain in cashouts that more than offset a record-low rate-term share.

The Mortgage Daily U.S. Mortgage Market Index for the week ended March 16 drifted lower by 4 percent from the previous seven-day period. Seasonal factors are not considered in the index.

Even worse was the year-over-year performance, with the MMI tumbling 26 percent from the week ended March 17, 2017. The index reflects potential upcoming loan originations based on average rate locks per user at clients of OpenClose.


Fee Simple: Understanding CA's New Recording Fees


On Sept. 29, 2017, California Gov. Jerry Brown signed Senate Bill 2, the Building Homes and Jobs Act, authored by Senator Toni Atkins (D-San Diego).

The act creates a new source of funding for affordable homes by charging a $75 fee for recording certain types of real estate documents. It is estimated that the new fee will generate $250 million each year.

The act, which became effective immediately, is part of a comprehensive package of legislation that aims to address California's housing dilemma by imposing a new duty on counties to send quarterly revenues from this fee, after deduction of administrative costs, to the state controller for deposit in the Building Homes and Jobs Fund, created within the State Treasury.


Multifamily Drives Down Permits, New Construction


Multifamily activity drove down overall housing permits and new construction last month, though there was an increase in completed apartment buildings. Construction activity in the Northeast was exceptionally strong.

In places where housing permits are issued, there were preliminarily 90,500 privately owned housing units authorized during February, bringing the year-to-date total to 187,200.

Last month's activity worked out to a seasonally adjusted annual rate of 1.298 million, slowing from a downwardly revised 1.377 million one month previous.