Coronavirus

The mortgage giants were criticized earlier this month for a plan to charge an "adverse market fee" to protect against losses resulting from the pandemic.

While cutting losers to buy winners is an age-old investment proposition, the Covid-19 pandemic may create even more openings than the past crises that became bonanzas for real estate investors.

Lenders initially won't be able to pass on the cost of the Federal Housing Finance Agency's "adverse market fee" to borrowers whose rates on GSE-backed mortgages and refinances are already locked in.

Banks and other lenders have found a way to potentially make billions of dollars from the coronavirus-fueled upheaval in the U.S. mortgage market — yet it risks burning bond investors in the process.

The Consumer Financial Protection Bureau says the proposal would increase access to credit, but consumer groups argue that it will encourage lenders to make high-cost loans while protecting them from legal liability.

For the second consecutive month, the average extension rate in June for troubled loans due to pandemic-related stresses on borrowers shrank in both prime and subprime loan sectors.

The number of loans going into coronavirus-related forbearance decreased for the ninth consecutive week, according to the Mortgage Bankers Association.

Dana Wade, a former OMB official, says a strong capital footing will help the Federal Housing Administration weather an uptick in delinquencies and ensure the mortgage market is viable once the economy recovers.

A pioneer in the commercial mortgage-backed securities market argues the HOPE Act would bail out savvy investors who don't deserve it. Barclays predicts that kind of attitude will make passage difficult.

With the moratorium still in place, mortgage foreclosure activity fell 83% in July compared to the year before and 4% from June, according to Attom Data Solutions.