Refinance

The loans, which are not federally guaranteed, are refinancings of student-loan debt held by prime borrowers primarily with advanced medical degrees.

Low rates, along with increased new and existing home sales activity drives the latest forecast.

Mortgage applications decreased 2.5% from one week earlier as refinance activity appears to decelerating, according to the Mortgage Bankers Association.

Only 18% of refinance borrowers returned to the same lender in the second quarter, the second lowest rate since 2005.

The guidelines are somewhat similar to those the Federal Housing Finance Agency established for the government-sponsored enterprise market in response to the high number of loans impacted by coronavirus-related hardships.

The new reality for investors and originators accounts for forbearances and ability-to-repay.

Mortgage application volume decreased 6.5%, falling for the second consecutive week with refinance activity at its lowest since early July, according to the Mortgage Bankers Association.

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.

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.

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.