1
August 13, 2013David H. Stevens
President & CEOMortgage Bankers
Association
2
Rates
3
Outlook for 2013 and 2014
Source: MBA July 2013 Forecast
4
Estimated Originations 1990 to 2014: SF Market
Source: MBA – July 2013 Mortgage Finance Forecast
5
Recovery in Household Growth Has Only Just Begun
5
Foreign Born
6
Minorities Will Drive Household Growth
Sources: JCHS 2010 Household Growth Projections and US Census Bureau, 2011 ACS
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
ACS 2011
HispanicAsian / OtherBlack, Non HispanicWhite, Non Hispanic
0%
20%
40%
60%
80%
100%
JCHS Low Projection
Household Growth, 2010-20Households
7
Wahington View: Role Oversized & Outdated
1ST Loss Position
8
Piling On
Real Estate Finance System
Compliance
Rule Making
Coker-Warner
Hensarling
FHA Solvency
The Federal Reserve
QE3
Basel IIIGSE Reform
9
HMDA Data for 2011 Shows Net Exit From the Business
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20116,500
7,000
7,500
8,000
8,500
9,000
9,500
Number of Institutions Reporting HMDA Data
Source: FFIEC
10
Credit Expanding On High End – Shrinking On Low
Source: MBA MPMA
Jan-Jun 2013 versus 2012 Purchase Tranche Analysis2013 shares 2012 Shares YTD Change YoY 2013_2012
<=150K 35.9% 40.6% -1.7%>150K and<=300 37.0% 36.7% 12.1%>300K and<=417k 14.7% 13.2% 24.0%>417K and<=625k 6.7% 5.3% 40.2%>625K and <=729k 1.9% 1.4% 51.8%>729K 3.9% 2.8% 57.0%
100.0% 100.0% 11.4%
11
Retail Apps per Underwriter per Month
12
Broad Access to Credit
“The pendulum has swung too far the other way.”~Federal Reserve Chairman Bernanke, November 2012
“The average FICO score for denied applications in 2012 was 733 and the average LTV for denied applications was 81%.”
~Ellie Mae, January 2013
“Credit is achingly tight.” ~CFPB Director Richard Cordray, January 2013
Upon release of the Ability to Pay Rule
“Too many families with solid credit who want to buy a home are being rejected.”
~President ObamaState of the Union Address, January 2013
13
Seat at the Table
14
1. Privatize and Recapitalize•Shareholder Path
2. Receivership and Liquidation•Hensarling
3. Shut Down and Replace•Corker Warner•BPC•President•MBA
Options Being Discussed
15
16
MBA’s Key Steps to GSE Reform
17
Why Now – Control Our Destiny
• Legislation Will Overtake Us• G-Fee Tinkering
• Congress• FHFA
• Transparency• Competition• Appeals To ALL Outcomes• Proactive – Not Head In The Sand• No Legislation Required• Fills In The White Board
18
Lead – Follow – Get Out Of The Way
Let’s Choose To Lead
19
Control Our Destiny
20
Control Our Destiny
