Underwriting

February was the second consecutive month where lenders eased underwriting, although overall availability remains near record low levels, the Mortgage Bankers Association.

January volume increased 36% compared to the month before and the annual decline in activity was the lowest in almost two years, Optimal Blue said.

Industry consolidation has resulted in fewer conventional and government loan programs being offered to consumers.

Decreasing availability of jumbo and non-QM products accounted for most of November's pullback, as other types of loan offerings saw minimal changes, the Mortgage Bankers Association said.

If the Federal Housing Administration's rulemaking on home equity conversion mortgages were to go into effect as written, borrower contributions would be reduced by thousands of dollars.

The average interest rate for the 30-year loan rose for the fifth consecutive week, according to Freddie Mac, but Treasury yields did move lower.

With prices continuing to increase and the conforming 30-year mortgage rising above 7% in July, the purchase market is in a holding pattern, Black Knight said.

But its operating income missed estimates with servicing income and gain-on-sale margins coming in lower than expected.

Product availability for July remained at levels last seen in 2013 as rates briefly broke above the 7% mark during the month, the Mortgage Bankers Association said.

But mortgage numbers remain historically very low and fall short of pre-pandemic levels, according to VantageScore's latest monthly report.

Renovations, already the leading use for these borrowings, increased their share to nearly two-thirds of the products' market, the Mortgage Bankers Association said.

Ten Western states that benefited from a pandemic-driven boom reported value declines in May, CoreLogic said.

The findings from Standard & Poor's show little impact from the Federal Housing Finance Agency's proposal regarding what information is required to underwrite a conforming mortgage.

Weaker economic conditions, rising interest rates and expected changes in investment returns drove the reduced expectations, the Mortgage Bankers Association said.

But with rates turning back up this past week, activity could fall in February, Black Knight Optimal Blue said.

However, a tiered pricing system will limit an inflation-driven increase to under 10% for a small group of originators.

The change, effective Dec. 21, is being put into place two years after it was first proposed.

The development, touted as an industry-first, is the latest move by the government-sponsored enterprises to expand housing opportunities for first-time and underserved homebuyers.

Rate and term refinance activity has practically disappeared compared with 12 months ago, and volume for the less rate sensitive cash-out product is much lower.

Historically tight underwriting reinforced by regulation and third-party reviews could be buffers, so long as manufacturing standards for production and servicing hold up as residential mortgage companies downsize, according to KBRA.