Mortgage credit loosens on products targeted at higher-rates
National Mortgage News
In-depth analysis, strategy and data spanning the entire residential mortgage industry. An Arizent brand.
Mortgage credit availability improved in December, a result of lenders bringing out products that are suited for the higher interest rate environment the housing market was — and remains — in. The Mortgage Bankers Association's Mortgage Credit Availability Index rose by 0.7% to 96.6 from 95.9 in November. In December 2024, the index was 92.1, which was the lowest in a decade. This increase was "driven by more offerings for ARMs and cash out refinances that are primarily for borrowers with better credit," said Joel Kan, the MBA's deputy chief economist. "These factors led to a slight rebound in conventional credit compared to the previous month."
The latest update to the previously drafted servicing defect taxonomy sharpens distinctions between servicing and related underwriting loan reviews, and provides more detail about severity tiers, remedies and indemnification. The Department of Housing and Urban Development has codified this guidance in a mortgagee letter, marking the first time the Federal Housing Administration has published detail on the method it uses to identify servicing defects outside of a draft-only process. The new guidance addresses a "transparency gap" for FHA, the administration said in an information bulletin issued this week.
The deadline for large nonbanks to submit their information to the Consumer Financial Protection Bureau's new compliance registry is next week but a new Trump-appointed director could change course, as some hope. Even though the registration process is ongoing, with other nonbanks under CFPB supervision set to register by April 14 and all other covered nonbanks to follow by July 14, the incoming Trump administration could scrap the regulation that created the database in the first place.
Craig Phillips, once counselor to former Treasury Secretary Steve Mnuchin during the first Trump administration, will join Freddie Mac as an executive vice president next week. Phillips will work directly with senior leadership while overseeing external affairs and corporate strategy, including matters involving the government sponsored enterprise's conservatorship, industry relations, regulations and broader marketing communications. During Trump's first term, both Phillips and Mnuchin both worked to prepare Freddie and its competitor, Fannie Mae, for an exit from conservatorship.
Sign up here to receive the National Mortgage News complete newsletter — delivered to your inbox daily.