A Primer on HECM Loans

In September, RiskSpan announced the addition of Ginnie Mae’s loan-level Home Equity Conversion Mortgage (“HECM”) dataset to the Edge platform. The dataset contains over 330,000 HECM loans with origination dates from 2000 to 2018 and reporting periods from August 2013 to October 2018.   This post is a primer on HECM loans, the HMBS securities they collateralize, and the structure of the new dataset.  What is a HECM?  HECMs are FHA-insured reverse mortgages that provide people 62 and older with cash payments or a line of credit… ShareTweetShare

Join Us: Webinar – The Value of Mortgage Insurance Under CECL

Join us on November 7th, for our joint webinar, ‘The Value of Mortgage Insurance Under CECL’, hosted in partnership with MGIC. This webinar will focus on some of the benefits that mortgage insurance can provide mortgage investors with CECL regulations, most notably a lower allowance for credit losses. We will also be quantifying the value… ShareTweetShare

Data Management

Institutionalization of the Single-Family Rental Market

FinTech advancements in big data analytical capabilities are prompting Wall Street to turn its focus to non-traditional real estate markets–specifically single-family rental homes. Overview of the Single-Family Rental (SFR) Market The housing crisis created a significant shift from homeownership to renting. According to research by RCLCO, a real estate advisory group, single-family rentals made up… ShareTweetShare

Is This a “Qualified Mortgage”? Ask Fannie Mae

Who really defines what constitutes a “Qualified Mortgage”? The answer, though codified in federal regulation, is not as simple as it may appear. Updates to Regulation Z in response to the Dodd-Frank Act seem straightforward enough. Under the regulation, “Qualified Mortgage” status is presupposed so long as: 1) the loan lacks certain characteristics, including negative… ShareTweetShare

qualified mortgage high dti

Houston Strong: Communities Recover from Hurricanes. Do Mortgages?

The 2017 hurricane season devastated individual lives, communities, and entire regions. As one would expect, dramatic increases in mortgage delinquencies accompanied these events. But the subsequent recoveries are a testament both to the resilience of the people living in these areas and to relief mechanisms put into place by the mortgage holders. Now, nearly a… ShareTweetShare

The Surging Reverse Mortgage Market

Momentum continues to build around reverse mortgages and related products. Persistent growth in both home prices and the senior population has stoked renewed interest and discussion about the most appropriate uses of accumulated home equity in financial planning strategies. A common and superficial way to think of reverse mortgages is as a “last-resort” means of… ShareTweetShare

In Defense of the Federal Home Loan Banks

We succumbed to some clickbait yesterday when we encountered a Risk.net article entitled “FHLBs: safe as houses?” The subheading ominously read, “Health of huge bank funder rests on home loans and money market funds.” It caught our attention because we are well acquainted with the Federal Home Loan Bank system—an affiliated group of government-sponsored enterprises,… ShareTweetShare