Volume 2014 - Number 27
July 11, 2014
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A promising surge in purchase-mortgage lending was the key ingredient in the 13.3 percent increase in agency issuance of single-family MBS during the second quarter of 2014, according to a new market analysis and ranking by Inside MBS & ABS. Fannie Mae, Freddie Mac and Ginnie Mae issued a total of $212.23 billion of single-family MBS during the second quarter. That was a nice gain from an exceptionally poor $187.38 billion in production during the first three months, but it still marked the second lowest quarterly volume since the beginning of 2005 – and it fell short of the $213.12 billion produced at the low point in the financial crisis at the end of 2008. The agencies securitized...[Includes two data charts]
The six lawsuits filed in June by institutional investors against non-agency MBS trustees are just the beginning of actions against trustees, according to an attorney who has pursued representation-and-warranty claims against non-agency MBS issuers. “We are likely to see a flood of litigation against trustees alleging that the banks sat on their hands and blew the statute of limitations on valuable putback claims,” according to Isaac Gradman, an attorney at Perry Johnson Anderson Miller & Moskowitz. The June lawsuits by BlackRock, PIMCO and other institutional investors targeted...
Redwood Trust took three months off from issuing jumbo MBS but came back with something of a doozy this week: a $306.05 million deal that will include some loans that don’t meet standards for qualified mortgages and some loans that weren’t subject to third-party due diligence reviews. Sequoia Mortgage Trust 2014-2 is set to receive AAA ratings with credit enhancement of 7.57 percent on the top-rated tranche. While the credit enhancement requirements are somewhat high, a jumbo MBS from Redwood in November had even higher credit enhancement levels, suggesting that the non-QMs and lack of full due diligence aren’t a major concern. Only three of the 438 mortgages to be included in the deal are...
The Home Affordable Refinance Program has nearly reached the practical limit of eligible homeowners willing and/or able to refi – whether or not the regulator of Fannie Mae and Freddie Mac further tweaks the program’s eligibility requirements, say industry observers. This week, Federal Housing Finance Agency Director Mel Watt met with community leaders in Chicago in a town hall-style meeting to discuss the benefits of HARP. Last fall, the agency launched a nationwide public awareness campaign to reach eligible borrowers and encourage them to participate in HARP, with little apparent success. “We are...
Fed Issues Action Plans for Goldman Sachs, Morgan Stanley to Improve Oversight of Third-Party Servicers
The Federal Reserve has released action plans for Goldman Sachs and Morgan Stanley to correct deficiencies in the firms’ risk management procedures for third-party mortgage servicers. The plans were a requirement under enforcement actions issued by the Fed and the Office of the Comptroller of the Currency between April 2011 and April 2012 against 16 mortgage servicers, including Goldman Sachs and Morgan Stanley. The servicers came under scrutiny for deficient servicing practices and foreclosure procedures, and later settled with the government. Morgan Stanley’s regulatory action plan supplements...
MBS Investing REITs Have Been Paying Hefty Dividends the Past Few Years, But How Long Can the Gravy Train Last?
Real estate investment trusts that have been gobbling up MBS the past few years – and paying hefty dividends in the process – may have some more room to run, especially if interest rates remain relatively benign. “Given the tailwinds of lower prepayment speeds and Fed purchases, we believe that payout levels should remain stable in the near term,” said one veteran analyst who works for a top five bank. This analyst, who tracks several large REITs that invest in agency securities, added...
The Securities Industry and Financial Markets Association has called upon federal financial institutions and consumer protection regulators to form an interagency working group to establish joint, uniform diversity standards for the financial services industry. The standards would implement a requirement of the Dodd-Frank Act for consistent, uniform rules to assess the diversity policies and practices of financial institutions. The rules would also spell out criteria and procedures for determining whether a contractor or subcontractor has made a “good-faith effort” to include minorities and women in its workforce. Several of the agencies jointly proposed...
Fitch Ratings has consolidated a number of key rating drivers into updated master rating criteria for residential MBS backed by newly originated and seasoned residential mortgages. The latest report replaces the July 2013 RMBS criteria, and while no material changes have been made to the overarching process, a few tweaks have been made. The important rating drivers that were incorporated include...
One page of issuance data.
- Top Mortgage Players: 1Q14
- Agency Condo Market: 2013
- Mortgage Profitability Report: 4Q13
- GSE Seller Profile: 1Q14
- GSE Private Mortgage Insurance Profile 1Q14
- GSE Repurchase Activity Full Year 2013
- Non-Qualified Mortgages
- CFPB Exam and Enforcement
- Mortgage Buybacks Guide 2014
- Mortgage Originations Channels
- CFPB Mortgage Disclosure Requirements
- Qualified Residential Mortgages and Risk Retention
- CFPB's LO Comp Rule
- Ability-to-Repay Rule and Qualified Mortgages
- Fair Lending Compliance
- CFPB Regulation of Mortgage Servicing
Most Popular Stories
- What Were Hearing: Is Our Mortgage Origination Estimate Crazy? / Good News from At Least One Warehouse Lender / Bullish on Non-QM Lending? / The FHFA MI Proposal is Out and the World Hasnt Ended, Yet / As for Radian / Frank Raines New Job
- Surprise: Mortgage Originations May Have Topped $310 Billion in 2Q
- HAMP Program Extended to the End of 2016, At Least
- Fannie and Freddie Securitized a Healthy Crop of MI Mortgages in 2Q
- Short Takes: More Room to Run for Mortgage Insurance Stocks? / Nationstar Cuts New Employment Deal with Its President / Is the Single-Family Investment Market Overheating? / FHFA Hoping on HARP