Administration: Buyers Will Save Money On Mortgage Payments Through Premium Reduction

By KIMBERLEY HAAS The Biden administration has announced a reduction on mortgage insurance premiums in a move they say could benefit an estimated 850,000 borrowers over the coming year. New borrowers who take out loans insured by the Federal Housing Administration will see the effects of the reduced premiums, according to a press release. The premiums will be reduced from 0.85% to 0.55% for most homebuyers, which could mean an estimated savings of $678 million for American families by the end of 2023, according to officials. Vice President Kamala Harris and Department of Housing and Urban Development Secretary Marcia Fudge made the announcement in Bowie, Md., on Wednesday. White House officials said the average homebuyer in Prince George’s County –…

Opinion: Another Pointless Government Mortgage Pricing War Begins

By TOBIAS PETER  Last month, at the behest of the Federal Housing Finance Agency, Fannie Mae and Freddie Mac, the government-sponsored enterprises, announced new risk-based pricing guidelines that loosen mortgage credit for higher-risk loans. Since the Federal Housing Administration traditionally serves higher-risk borrowers, this move represented the latest salvo in a renewed battle for such borrowers. As a response, FHA is rumored to announce today (2/22/2023) a 30 bps mortgage insurance premium cut that will expose taxpayers and not help prospective homebuyers. The last time FHFA imposed credit loosening on the GSEs in 2014, FHA responded shortly thereafter in kind with a large 50 bps MIP cut. At the time, FHA predicted that this cut would lead to 250,000 new…

HUD Assisting Local Governments Bringing Housing And Transportation Together

Officials at the U.S. Department of Housing and Urban Development have opened a portal for local government leaders to request technical assistance so housing needs are considered as part of their larger infrastructure investment plans. The Thriving Communities technical assistance program was designed to help local government leaders identify land for housing development near transportation projects, develop preservation and anti-displacement strategies, reduce barriers to location-efficient housing, improve intergovernmental coordination, and support a holistic approach to housing and transportation. HUD Secretary Marcia Fudge said they are working with local government leaders, transit authorities, metropolitan planning organizations, the private sector, and community-based organizations. “A thriving community is intentional about building and preserving affordable housing near public transportation and leveraging infrastructure investments to…

Insulation Contractor Sentenced To 15 Months In Prison For Bid Rigging, Fraud

By KIMBERLEY HAAS The last of seven defendants in a bid-rigging and fraud scheme that targeted Yale University and Pepsi was sentenced to 15 months in prison and ordered to pay over $1 million in restitution. Michael Flynn was sentenced in Bridgeport, Conn., on Friday of last week, according to officials at the U.S. Department of Justice. The bid-rigging and fraud scheme, which ran for nearly seven years, involved the installation of insulation around pipes and ducts on construction projects at universities, hospitals, and other public and private entities in Connecticut, according to a press release. “This fraud and deception of the public and commercial consumer has ended with this sentence,” Jean Pierre Njock, acting special agent in charge of…

CFPB Warns Of Double Dealing On Digital Mortgage Comparison Shopping Platforms

By KIMBERLEY HAAS Officials at the Consumer Financial Protection Bureau are warning shoppers about pay-to-play mortgage comparison shopping platforms. CFPB Director Rohit Chopra said in a statement on Tuesday that given current mortgage interest rates, it is important for homebuyers to shop and compare loan offers. “We are working to ensure that online platforms are not manipulating their search results in order to coerce kickbacks from lenders,” Chopra said. Rates for a 30-year fixed-rate mortgage hovered just above 6% last week. In a press release, CFPB officials said that American consumers looking for the best deal on mortgages often turn to comparison-shopping platforms and mobile apps. “Many of the websites and applications claim to offer ranked lists of providers suitable…

Powell On Inflation: “We Will Stay The Course Until The Job Is Done”

By KIMBERLEY HAAS After officials at the Federal Reserve raised rates by 25 basis points, Chair Jerome Powell said that the fight against inflation isn’t over and he does not see them cutting rates this year. During a press conference on Wednesday afternoon, Powell said the disinflationary process has started in some sectors of the economy but they remain cautious. “Certainty is just not appropriate here. Inflation, it’s just hard to forecast inflation. It may come down faster. It may take longer to come down, and yet, our job is to deliver inflation back to target and we will do that, but I think we’re going to be cautious about declaring victory and sending signals that we think that the…

Opinion: For a Strong Mortgage Market, Strengthen the Ginnie Mae PTAP Program

By SCOTT OLSON Recently, Wells Fargo announced it was exiting the correspondent mortgage loan business, eliminating an important execution source for smaller independent mortgage banks that originate FHA, VA, and Fannie/Freddie loans but are not Ginnie Mae-approved issuers or Fannie/Freddie seller-servicers. This development is only the latest in a persistent 10-year trend, documented in our latest IMB Report issued last October by the Community Home Lenders of America. As large banks have exited the mortgage business, independent mortgage banks picked up the slack. IMBs now originate 90% of FHA and VA loans and issue 90% of Ginnie Mae mortgage-backed securities. When an IMB acts as a Ginnie Mae issuer, it not only services the loans, but it is also legally…

Tenant Protections And Homelessness Addressed By Federal Officials

By KIMBERLEY HAAS The Biden-Harris administration announced new actions to protect renters this week and leaders at the U.S. Department of Housing and Urban Development celebrated helping over 100,000 families through their homelessness initiative. On Wednesday, administration officials issued a fact sheet describing key actions officials are taking “to increase fairness in the rental market and further principles of fair housing.” They include: Identifying practices that unfairly prevent applicants and tenants from accessing or staying in housing. Ensuring accurate information in the credit reporting system and holding background check companies accountable for unreasonable procedures. Providing guidance updates around anti-competitive information sharing, including in rental markets. Requiring public housing authorities and owners of project-based rental assistance properties to provide at least…

BofA Invests Up To $150M To Preserve Housing For Middle-Income Earners

By KIMBERLEY HAAS Leaders at Bank of America Community Development Banking have announced an up to $150 million investment to preserve more than 3,000 affordable homes for middle-income households. In partnership with Enterprise Community Partners, a national nonprofit that offers solutions, capital, and community development, Bank of America will help workers earning between 80% and 120% of an area’s median income remain in housing they can afford. According to Maria Barry, national executive for Bank of America Community Development Banking, as rent costs outpace income growth the lack of affordable housing inventory is forcing families to make difficult decisions on how and where they live. “This fund will focus on the ‘missing middle,’ which refers to middle-income individuals who make…

HUD Officials To Fight Inequities In Housing With New Proposed Rule

By KIMBERLEY HAAS A new proposed rule meeting President Joe Biden’s call to fully enforce the Fair Housing Act was announced by officials at the U.S. Department of Housing and Urban Development on Thursday. “Affirmatively furthering fair housing means more than merely steering clear of housing discrimination violations,” Demetria McCain, principal deputy assistant secretary for fair housing and equal opportunity, said in a statement. “Today, HUD is taking new, bold action to eliminate the historic patterns of segregation that continue to harm American families. This action will help make the purpose of the Fair Housing Act reality by making it easier for local communities to identify inequities and make concrete commitments to address them.” According to a press release, the rule…