Startup LoanSnap, a company funded in part by Virgin Group founder Richard Branson, has launched artificial intelligence that matches consumers with mortgages based on a complex analysis of their financial situation.
A Fannie Mae test to handle the private mortgage insurance process for lenders may raise concerns that it's going outside the scope of its secondary market mission. But the effort reflects its mandate to explore new credit-risk transfer alternatives, a company executive said.
Fannie Mae and Freddie Mac enjoy considerable advantages because of their lower cost of capital and significant government subsidies. But with some conforming loans, the private market is finding a way to compete.
Since its inception, the qualified mortgage rule has been synonymous with loans purchased by Fannie Mae and Freddie Mac or guaranteed by government agencies. But a broader QM definition could change that by creating more competitive private-label options.
JPMorgan Chase has largely sat on the sidelines of Federal Housing Administration lending due to compliance concerns. But recent regulatory relief efforts have Chase Home Mortgage CEO Mike Weinbach eyeing an opportunity to jump back in.