Nonbank

Refinancing activity is surging, existing borrowers are inquiring about loan modifications, loan closings are being delayed by more complex credit checks — and banks are short on people to handle it all.

Banks may be protected from a direct hit, but they have invested in vehicles that include such loans, potentially exposing them to defaults.

Mortgage companies that borrow heavily to keep their operations running may face financial pressure from coronavirus-related market volatility as it affects the valuations of collateral securing their financing.

The cancellation by New Residential of a money-losing subservicing agreement should benefit Ocwen's financial results going forward, the company said.

The Federal Housing Finance Agency plans to increase liquidity standards for nonbank conforming loan servicers, and at the same time raise the net worth requirements for those that also perform the function for Ginnie Mae.

Despite changes by the Federal Housing Administration, bankers remain reluctant to join the program for fear of legal liability. But that could change if it revamps servicing processes, experts say.

California Gov. Gavin Newsom plans to ask the legislature to revamp the current Department of Business Oversight and rename it the Department of Financial Protection and Innovation, modeled after the federal CFPB.

With fintech firms appearing stuck in neutral in their efforts to seek bank charters from federal regulatory agencies, observers say state licensing options could be in vogue again in 2020.

A report from the Financial Stability Oversight Council cited a bigger share of originations and servicing by nonbanks as a potential vulnerability in the financial system.

In a recent interview, Plaza Home Mortgage CEO Kevin Parra discussed why he likes certain underutilized loan products, thinks online lending will be limited, and is bullish on third-party originations.