Ginnie Mae has restricted loanDepot from including VA loans securities due to what it considered faster than average prepayment speeds.

The lender “respectfully disagrees” with the restriction, according to a press release from loanDepot. It is restricted from including VA single family guaranteed loans in Ginnie Mae I or Ginnie Mae II multi-Issuer securities. The restriction began February 1 and is slated to conclude July 1, according to Ginnie Mae.

The restrictions are part of an ongoing efforts to enforce Section 3-21 of Ginnie Mae’s MBS Guide. It establishes as a required program risk parameter that an issuer’s “origination and servicing practices…ensure that the performance of an Issuer’s securities is in line with that of similarly constituted securities for the Ginnie Mae portfolio as a whole.”

However, loanDepot, an approved issuer and servicer, can pool other Ginnie Mae products and can place Veterans Affairs loans into custom pools.

Prior to the government shutdown, LoanDepot had for several months been discussing with Ginnie Mae its prepayment experience on Veterans Affairs loans. The aim of those conversations was to help ensure its “prepay speeds on all [Ginnie Mae] products are in line with other market participants.” LoanDepot plans to resume those conversations with Ginnie Mae.

Also, Ginnie Mae has removed the restriction that limited Freedom Mortgage Corp. to Ginnie Mae II custom pools for Veterans Affairs single family guaranteed loans as of March 1, 2019. It is again eligible to use the Ginnie Mae I and Ginnie Mae II multi-issuer securities programs for these loans. The removal of such a restriction occurs when the issuer demonstrates that the prepayment speeds are in-line with other lenders, and the improved performance is sustainable.

More than a decade since the start of the financial crisis, performance metrics reflect a recovery to their long-term, 2000-2005 pre-recession averages, according to the “Mortgage Monitor Report” from Black Knight.

"Across the board, 2018 year-end numbers are good news from a mortgage performance perspective," said Ben Graboske, president of Black Knight's Data & Analytics division. "All four major performance metrics delinquencies, serious delinquencies, active foreclosures and total non-current inventory, ended the year below pre-recession averages for the first time since the financial crisis.”

Just 576,000 foreclosures were initiated throughout the entirety of 2018, an 18-year low, and most of these were repeat actions. In fact, first-time foreclosures were down 18 percent from 2017, the lowest point since Black Knight started reporting the metric in 2000. Even repeats, though making up more than 60 percent of all foreclosures, were down 6 percent from 2017.

The high-credit quality and corresponding lower risk continues to pay dividends in terms of mortgage performance. In addition, the low-interest rate environment resulted in a refinance-heavy blend of originations for years. Refis, as a whole, tend to outperform their purchase mortgage counterparts, which has boosted mortgage performance as well.

“We've had the benefit of strong employment and housing markets, which have helped the vast majority of homeowners meet their debt obligations, while those few who may have faced a possible default have gained enough equity to be able to sell rather than face foreclosure," said Graboske.

As the average interest rate on a 30-year mortgage ticked down again in January, falling below 4.5 percent for the first time since April 2018, Black Knight revisited the impact this change has had on borrowers for whom a refinance might make sense.

The decline in rates has returned the interest rate incentive to refinance to 1 million homeowners, a 50 percent increase in rate or term refinance incentive over the last two months. There are now 2.9 million homeowners with mortgages who could likely qualify for a refinance under broad-based criteria and also reduce the interest rate on their first mortgage by at least 0.75 percent by doing so, the largest this population has been since January 2018.

Even if rates should hold steady, and certainly if they fall further, this could lead to an unexpected bump in refinance volumes in early 2019.

In a sign that consumers are embracing digital banking, more than 72% of consumers reported they felt comfortable syncing their personal finances on their mobile phones.

Over 60% of consumers use financial apps for everyday banking, such as viewing account balances, budgeting and tracking expenses, or paying bills and transferring money, according to a survey from Webpals Mobile.

Fully 26% of them are do most of their banking digitally, and that statistic is steady across generations, for instance: Generation Z, 33.6%; Millennials, 27.7%; Generation X, 23.3%; baby boomers, 25.4%. However, just 10% use personal finance apps to apply for loans or mortgages.

Other highlights from the report are as follows:

• Men were twice as likely as women to use financial apps for investing.
• Millennials, 53%, are almost twice as likely as baby boomers, 27%, to use financial apps for depositing checks.
• Older respondents reported more distrust of synching financial apps to their phones: Gen Z, 9.7%; Millennials, 13.1%; Gen X, 14.8%; baby boomers, 23.3%.
• Only 10% of respondents have downloaded a financial app but never used it.
• One-third of respondents reported to having no other personal finance appdownloaded on their phone other than their bank's app

Fully 56% of respondents reported that they feel the level of customer service on apps is equivalent as in person. Gen X is most likely to feel customer service is better on a finance app than it is in person, with almost 30% of respondents agreeing apps are superior when it comes to advice and information.

At a time when banking is going digital, app developers should remain cognizant of the importance of consumer trust, providing safe and efficient mobile banking services that rival, or even trump, that of traditional banks.

"This survey highlights just how trusting consumers have become with their mobile applications," said Inbal Lavi, CEO of Webpals. "Today's banking customers want the ease of financial apps but the same trust and respect they have been accustomed to with traditional banking. While potential customers are often familiar with brick and mortar branches, we can expect to see a steady increase in the rise of mobile finance consumers."