Why fewer credit reports could mean more complexity for mortgages
National Mortgage News
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The Federal Housing Finance Agency's proposed timeline for a long-awaited update to mortgage credit reporting and scoring starts with what looks like a relatively simple step, but even that has complications. The move from using one merged report containing information from all three bureaus that serve as repositories for consumer payment histories to the option to use two changes a process that a large number of credit operations in the U.S. mortgage industry have been built around. If the original timeline set by the FHFA holds, lenders selling to Fannie Mae and Freddie Mac could be doing underwriting based on two reports rather than three by the first quarter of next year.
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A federal jury has ruled in favor of Fannie Mae and Freddie Mac shareholders in a decade-old lawsuit over the government's takeover of the enterprises after the subprime mortgage crisis. On Monday, a jury found that the Federal Housing Finance Agency improperly amended a stock repurchase agreement for shares of Fannie and Freddie in 2012 as part of the government's conservatorship of the enterprises. The arrangement enabled the Treasury Department to "sweep up" the net worth of the mortgage market makers. The jury awarded the shareholders more than $600 million of damages.
Home buyers were more active in purchasing newly constructed properties in July, rebounding from the month prior, with Federal Housing Administration and Veterans Affairs loan applications driving the increase, according to the Mortgage Bankers Association. Loan volume for this segment jumped by 0.2% from June and was up 35.5% compared to the year prior, the trade group's Builder Application Survey found. This is despite a volatile mortgage market where the conforming 30-year fixed rate mortgage has hovered at or above 7%.
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Title insurance earnings for the most part rebounded in the second quarter, with five of the six publicly traded companies reporting profits. Doma, the sixth, reported a lower net loss versus comparable periods. Open orders generally rose quarter-to-quarter, reflecting the higher mortgage origination volume. Doma was the exception, conducting an ongoing reinvention as it looks to achieve adjusted EBITDA profitability this year. Right now the company appears to have reached a make or break moment.
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Better.com will finally become a publicly-traded company after a tumultuous 27-month wait. Over 96%, or 8.7 million shareholders of Aurora Acquisition Corp. voted Friday for the business combination with the digital lender, according to a Securities and Exchange Commission filing. The companies first announced the move in May 2021. The special purpose acquisition company voters gave unanimous recommendations for the firm's board of directors, including Better founder and CEO Vishal Garg. Aurora, in a brief statement Friday, said the business combination is anticipated to occur on or about August 22. The lender will trade on the Nasdaq stock market under the symbols "BETR" and "BETRW".
Two former loan officers lodged a lawsuit against Rocket Mortgage in mid-July accusing the home lending giant of failing to pay overtime. The plaintiffs are asking the U.S. District Court for the Eastern District of Michigan Southern Division to certify this case as a class action. If the request gets approved, this will be at least the second class action for the company featuring similar allegations.
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Realtor Associate @ Next Trend Realty LLC | HAR REALTOR, IRS Tax Preparer
1yThanks for the updates on, The NMN.