Underwriting

A top official at the Office of the Superintendent of Financial Institutions defended tougher underwriting rules blamed recently for a slump in the nation’s housing market, but left open the possibility that regulations could ease if conditions change.

The bloc said the company artificially raised interchange fees in Europe; weather changes that increase flood risks may mean defaults on mortgages.

Borrowers and financial institutions may be feeling the strain from reduced operations at the FHA and IRS, which has suspended the release of certain income documentation during the budget impasse.

The Federal Housing Finance Agency has proposed barring Fannie Mae and Freddie Mac from using credit scores developed by VantageScore over concern about conflicts of interest with the joint venture of Equifax, Experian and TransUnion.

When the mortgage giant will be released from government control is anyone's guess, but the company's third-quarter report shows signs of an easier transition.

Despite recriminations about how the crisis and ensuing regulations have tightened loan access, an actual assessment of mortgage credit availability finds the situation is more complicated.

Some mortgage lenders are tapping artificial intelligence and machine learning to improve operational efficiency and enhance the borrower experience, but complexities do exist in implementing the technology.

Bill Emerson, the vice chairman of Quicken Loans, said mortgage lenders need to give time to consider innovation and not be deterred by naysayers.

New investor appetite for mortgages over $1 million is motivating more nonbank lenders to offer super jumbo loans, often with weaker credit terms than traditional banks.