Just what is this whole mortgage business built on anyway?
Check out my newly updated list of closed lenders!
HomeBanc is exiting the mortgage loan business and seeking the sale of remaining assets. Countrywide, the nation’s largest mortgage lender, will buy five retail branches in Georgia, Florida, and North Carolina.
Luminent Mortgage Capital Inc. took a nosedive on the stock market today, dropping over 82% to $0.78 a share on news that it failed to meet margin calls, and is likely the next lender to close its doors.
UBS announced that it will no longer buy “no-doc” loans, as they represent a level of risk the company is not comfortable with.
The question remains whether they will scrap other doc types as well in the coming months.
Impac Mortgage Holdings Inc. has tried to reassure investors that the company will be able to weather the storm, though they have cut a number of loan programs and seem to be focusing solely on conforming loans.
In a similar move to improve shareholder confidence, Countrywide announced that it has access to $46.2 billion in cash, credit, and other investments.
Countrywide is also exiting the 100% loan-to-value game, demanding at least a 5% down payment on purchase transactions.
In one bright spot of mortgage news, Fannie Mae asked for a higher mortgage cap, looking to expand their business of purchasing loans on the secondary market.
The request likely comes after recent news suggests most closed loans will be conforming loans, with Fannie and Freddie being the beneficiaries.
The stock jumped over 10% on the news, its biggest percentage gain in over 20 years.
Conforming loan rates are dropping, while jumbo loan rates keep surging upward.
Additionally, the Mortgage Bankers Association’s index of mortgage applications rose 8.1 percent to 656.5 from 607.1 the prior week, the highest weekly gain since January, thanks in part to lower mortgage rates.