TheMReport — News and strategies for the evolving mortgage marketplace.
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42 | Th e M Rep o RT O r i g i nat i O n S e r v i c i n g a na ly t i c S S e c O n da r y m a r k e t SERVICING the latest cFPB adjusts Qm thresholds on Points and Fees Agency Announces the first round of chAnges since rule implementAtion. S even months after the implementation of its ability-to-repay (ATR) and qualified mortgage (QM) rules, the Consumer Financial Protection Bureau (CFPB) announced it is tweak- ing the loan thresholds used to determine maximum points and fees for QM loans. The new rule updates the point and fee limits that loans must meet in order to fit the QM definition and be consid- ered a "safe" loan. The bureau is required under the Truth in Lending Act (TILA) to recal- culate loan limits on an annual basis to adjust for inflation. Based on the latest calcula- tions, CFPB's amended rule now states that points and fees cannot exceed: • 3 percent of the total loan amount for any loan greater or equal to $101,953 • $3,059 for loans greater or equal to $61,172 but less than $101,953 • 5 percent of the total loan amount for mortgages greater or equal to $20,391 but less than $61,172 • $1,020 for loans greater or equal to $12,744 but less than $20,391 • 8 percent for loan amounts less than $12,744 • The changes are set to go into effect January 1, 2015. Firms Boost Originations, Shrink Servicing production was up a quarter from Q1 but down by half from a year ago. t he second quarter of 2014 saw a sizable jump in mortgage origination volumes, while servicing portfolios shrank at many of the biggest firms, according to a recent market report. Based on data collected from April through June, Mortgage Daily reported a 24 percent quarterly increase in mortgage originations. New loans grew to an estimated $296 billion among all lenders as of June 30. However, production fell short by 51 percent on an annual basis as consumer demand for mortgages remained anemic and credit standards stayed tight. Mortgage Daily's report was released a week after investment bank Keefe, Bruyette & Woods published its latest market analysis, observing a 22-percent second-quarter improvement in originations among the lenders the firm tracks. Wells Fargo kept its top spot as the most active lender for the quarter, posting $47 billion in new loans, according to Mortgage Daily. JPMorgan Chase followed in the second rank with a reported $18 billion in new loans. Bank of America ($14 billion) took third place, knocking Quicken Loans ($13 billion) down to fourth. U.S. Bank ($12 billion) rounded out the report's list of the top-5-producing mortgage lenders in Q2. Together, the 10 biggest second-quarter lenders turned in 46 percent of the industry originations. While most lenders also reported stronger application pipelines moving into Q 3, statistics tracked by LoanSifter/ Optimal Blue and Mortgage Daily indicate a 3-percent decline in total loan volumes for the July- to-September period. In the servicing arena, Wells Fargo also reigned, boasting a nearly $1.8-trillion portfolio. Following Wells were Chase ($953 billion), BofA ($760 bil- lion), Ocwen ($381 billion), and Nationstar ($379 billion). With the exception of No. 10—Quicken Loans—none of the top-10 servicers actually grew their portfolios in Q2.