Mortgage lending sees greatest activity since January

The lowest interest rates in over a year led to a refinance boom last week, as volumes surged within both government and conventional lending, the Mortgage Bankers Association said.? The MBA's Market Composite Index jumped a seasonally adjusted 6.9% for the period ending Aug. 2. The spike reversed a two-week slide in applications, while compared to the same seven days in 2023, volumes also finished 10.6% higher. The conforming 30-year fixed interest rate among MBA lenders fell 27 basis points to 6.55% from 6.82% week over week.

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GSEs appear set to change multifamily lending rules

The government-sponsored enterprises are prepared to impose tighter lending rules on multifamily finance in an effort to reduce fraud risk, according to news reported Tuesday. Fannie Mae and Freddie Mac will require commercial lenders independently verify financial information of borrowers, possibly to include available cash on hand and sources of funding, a Wall Street Journal article said. They may also be set to mandate greater due diligence surrounding the appraised value of multifamily properties. Any new regulation is aimed at mitigating potential fraud risk within the segment, which currently allows lenders to operate with less supervision. But it also runs the risk of slowing business activity, which rebounded quickly following the pandemic.?

How much did homeowners insurance costs rise in Q2?

Leading property insurers secured rate increases this spring that are likely to hike homeowners' premiums by a combined hundreds of millions of dollars, a new analysis finds. State Farm's 11.3% approved rate increase in Minnesota will lead to a $108 million calculated premium change, the largest in the second quarter according to S&P Global Market Intelligence. The largest approved rate change by an insurer was 56.4% at American Modern Property and Casualty Insurance Co., a Munich Re subsidiary, in California. That rate hike results in a $22.4 million calculated premium change and affects 17,425 policyholders, according to S&P.?

Reconsideration of value rules delayed two months

The secondary market is delaying new reconsideration of value procedures that had been set to go into effect at the end of the month. Concurrently, the Department of Housing and Urban Development is doing the same for its Federal Housing Administration mortgage insurance program. All three set the same date, Oct. 31 for mortgage lenders to comply with the new rules. The new rules were rolled out by Fannie Mae and Freddie Mac in May, around the same time HUD issued a mortgagee letter on the topic.?

Finance of America reduces loss, reassures on NYSE status

Finance of America, which has been the largest reverse mortgage lender since its acquisition of American Advisors Group assets in 2022, remained in the red during the latest quarter but moved closer to profitability. The company recorded a $5.12 million net loss in the second quarter, down from $20.3 million in red ink in the first three months this year. The number narrowed from a $222.5 million quarterly net loss a year earlier. Executives said the reduced loss, the success of its plan to use a reverse stock split to resolve issues with its New York Stock Exchange status and other developments mean FOA's outlook has improved.

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