Jumbo Mortgages

Browse articles from all of our Newsletters related to Jumbo Mortgages.

November 26, 2014 - Inside Mortgage Finance

Correspondent Channel Saw Biggest Origination Volume Gains During Third Quarter of 2014

All three mortgage-production channels generated solid increases in new origination volume during the third quarter of 2014, but the correspondent market had a measurably bigger gain, according to a new Inside Mortgage Finance ranking and analysis. An estimated $105 billion of home loans were produced by correspondent originators during the third quarter, up 14.1 percent from the previous quarter. That lifted the correspondent share of new originations to 30.4 percent for the, and 30.3 percent on a year-to-date basis. Correspondents are...[Includes four data charts]


November 21, 2014 - Inside Nonconforming Markets

Subprime Volume Indicators and Performance

A page of subprime and jumbo data.


November 21, 2014 - Inside Nonconforming Markets

News Briefs

The Consumer Financial Protection Bureau proposed new servicing requirements this week. Among other changes, the federal regulator proposed requiring servicers to offer loss mitigation to borrowers that have received a loan mod but are in danger of re-default. The CFPB’s servicing rules currently require a servicer to evaluate a borrower for loss mitigation only once during the life of the loan. The proposed rule would also set requirements for ... [Includes three briefs]


November 21, 2014 - Inside Nonconforming Markets

REITs Tout Non-Agency Benefit of FHLBanks

Prohibiting real estate investment trusts from joining the Federal Home Loan Bank system would hurt efforts to revive the non-agency market, according to two REITs that have gained access to FHLBank financing. Officials at both Two Harbors Investment and Redwood Trust said FHLBank advances helped the REITs fund originations of jumbo mortgages in the third quarter of 2014. Both companies recently gained access to FHLBank advances via captive insurance entities ...


November 21, 2014 - Inside Nonconforming Markets

FirstKey Steps Up as Jumbo MBS Issuer

FirstKey Mortgage, a jumbo conduit indirectly owned by funds managed by Cerberus Capital Management, is set to issue its first jumbo mortgage-backed security. FirstKey ramped up its jumbo activity in the past year and to this point has aggregated loans for inclusion in jumbo MBS from other issuers, including WinWater Home Mortgage, another relatively new jumbo MBS player. The $285.98 million FirstKey Mortgage Trust 2014-1 is set to receive AAA ratings ...


November 21, 2014 - Inside Nonconforming Markets

SFIG Works on Due-Diligence Disclosure Issues

The latest “green papers” in the Structured Finance Industry Group’s RMBS 3.0 standards-setting project focus on due-diligence disclosures for investors in non-agency mortgage-backed securities. The SFIG noted that potential investors in non-agency MBS are particularly interested in findings conducted by third-party due-diligence firms before a security is issued. The SFIG proposed a model form that would disclose an “extract” of due-diligence findings to investors ...


November 21, 2014 - Inside Nonconforming Markets

MBS Investors Seek Protection, Transparency

As leading figures in the secondary market continue their efforts to reboot the non-agency mortgage-backed securities sector, attracting private capital remains the single most critical factor in the equation. However, during a recent industry conference, institutional investors made it clear that in order for them to return, the market’s infrastructure will need to provide stronger protections, enhanced transparency and an improved ability to respond when a deal starts to go sour ...


November 21, 2014 - Inside Nonconforming Markets

Treasury Sees Multiple Sponsors, SFIG Standards in ‘Benchmark’ Jumbo MBS

The benchmark non-agency mortgage-backed security that the Treasury Department is organizing will vary significantly from recent non-agency MBS. Michael Stegman, counselor on housing finance policy to the Treasury, revealed new details about the planned transaction last week in New York City at the Private-Label RMBS Symposium hosted by the Structured Finance Industry Group and Information Management Network. Stegman said the benchmark non-agency MBS will ideally be ...


November 21, 2014 - Inside MBS & ABS

MBS Pioneer Ranieri Active in the Single-Family Rental Space, But With a Twist; Can an MBS Deal Be at Hand?

Home Partners of America, a single-family rental company affiliated with MBS veteran Lewis Ranieri, has been quietly gobbling up homes across the U.S., and may have its eye on tapping the securitization market. “They are very active,” said one associate close to Ranieri, who spoke under the condition his name not be used. Moreover, Home Partners – formerly known as Hyperion Homes LLC – recently received...


November 21, 2014 - Inside MBS & ABS

RMBS Market Optimists See Some Key Positives, But Pessimists Cite Shriveled Levels of Issuance

Top mortgage finance professionals and government officials gathered in New York City last week to discuss the prospects for the non-agency MBS market, and their assessments were all over the board, a sign of the uncertainty many participants have about trying to resuscitate a stagnant sector. “It’s been seven years since the financial crisis, and certainly a lot of things have changed,” said Rui Pereira, managing director at Fitch Ratings, during a panel at the non-agency MBS reform symposium sponsored by the Structured Finance Industry Group and Information Management Network. He then cited...


November 13, 2014 - Inside Mortgage Finance

Mixed Results for Publicly Traded Nonbanks: Ocwen, Walter, PHH in the Dog House; PennyMac and Redwood Show Promise

Although residential lenders are coming off a better than expected production quarter – and enjoying a decent last three months of the year – analysts and investors seem undecided on whether there’s opportunity in the market or it’s time to stay on the sidelines. Several high profile publicly traded shops that are considered “high touch” specialists – Nationstar Mortgage, Ocwen Financial and Walter Investment – continue to trade at steep discounts to their 52-week highs with all three facing possible class-action lawsuits from angry investors who’ve seen billions of dollars in stock equity evaporate over the past year. And then there’s...


November 7, 2014 - Inside Nonconforming Markets

Subprime Volume Indicators and Performance

A page of subprime and jumbo data.


November 7, 2014 - Inside Nonconforming Markets

News Briefs

Ocwen Financial is working on a settlement with the New York Department of Financial Services regarding various servicing-related concerns raised by the state regulator. The $100 million in legal reserves that Ocwen booked in the third quarter of 2014 for a potential settlement is the minimum the company expects to spend, according to William Erbey, Ocwen’s chairman. “I would caution that this does not mean that we have settled with the [NYDFS] ... [Includes two briefs]


November 7, 2014 - Inside Nonconforming Markets

Ocwen Sets Sights on Non-Agency Originations

With growth via acquisitions of servicing portfolios on hold, Ocwen Financial is pursuing a number of different initiatives, including originations of non-agency mortgages. The nonbank primarily known for servicing high-touch mortgages is currently testing originations of jumbo mortgages and working toward originating nonprime mortgages. “The business is building a robust new product pipeline and is currently in the market testing a new jumbo mortgage product,” Michael Bourque ...


November 7, 2014 - Inside Nonconforming Markets

Strong Demand for Jumbo Originations From Both Banks and MBS Investors

Pricing for jumbo mortgage-backed securities has improved in recent months, prompting an increase in issuance from some firms, but bank demand remains robust. “Although the difference has narrowed, our whole-loan sale execution for most jumbo loans continues to be more attractive than our securitization execution as a result of strong demand from banks,” Brett Nicholas, president of Redwood Trust, said this week during a call with investors. In the third quarter of 2014, Redwood issued ...


November 7, 2014 - Inside MBS & ABS

BNYM Looking to Increase its Master Servicing In Non-Agency MBS Market; Wells Dominates

Bank of New York Mellon is looking to increase its master servicing activity on residential mortgages, according to officials at the firm that acquired the master servicing unit from JPMorgan Chase in October 2006. However, BNYM is up against stiff competition, including Wells Fargo, a dominant presence in master servicing for non-agency MBS. BNYM is focusing on growth opportunities from managing new funds in traditional residential mortgages as well as new loan types, according to a recent report by Fitch Ratings. In September, Fitch downgraded BNYM’s master servicer rating due to compliance issues, organizational changes and low activity in recent years. The firm has...


October 24, 2014 - Inside FHA Lending

GNMA Raises Net Worth, Liquidity Tests

Ginnie Mae this week provided new details to the long-anticipated plan for increased issuer net worth and liquidity and a new performance scoring method for issuer activity – changes that could adversely affect small issuers and portfolio servicers. In remarks at the Mortgage Bankers Association’s annual convention in Las Vegas, Ginnie Mae President Ted Tozer said the changes are part of a larger effort to ensure the continuing flexibility and availability of the agency’s mortgage-backed securities program to as many entities as possible. New types of issuers and counterparties have entered the agency-backed MBS market in the wake of the financial crisis, which called for adjustments and tailored approaches to the evolving housing finance market, Tozer noted. Tozer said both policy changes and staff expertise will ensure the success of ...


October 24, 2014 - Inside Nonconforming Markets

Subprime Volume Indicators and Performance

A page of subprime and jumbo data.


October 24, 2014 - Inside Nonconforming Markets

News Briefs

The Consumer Financial Protection Bureau this week issued a final rule providing lenders with a right to cure a mistake when the points and fees on what was intended to be a qualified mortgage inadvertently surpass the allowable points-and-fees cap on QMs. Points and fees charged to a borrower for a QM generally can’t exceed 3.0 percent of the loan principal at the time the loan is made. If a lender discovers after the loan has closed that the ... [Includes three briefs]


October 24, 2014 - Inside Nonconforming Markets

REITs See Mixed Success with Jumbo MBS

Officials at Five Oaks Investment said the real estate investment trust plans to continue its involvement in the jumbo mortgage-backed security market after aggregating some of the mortgages included in the $355.6 million JPMorgan Mortgage Trust 2014-OAK4. “This represents the culmination of our residential whole loan strategy that we have been implementing since last year, and we actively look forward to participating in additional transactions in the near future as our loan purchase volumes ...


October 24, 2014 - Inside Nonconforming Markets

Jumbo Production Remains Concentrated in CA

California continued to dominate jumbo originations in 2013, according to an Inside Nonconforming Markets analysis of data from the Home Mortgage Disclosure Act. The $96.74 billion in jumbos originated in California in 2013 accounted for 36.9 percent of total jumbo production during the year. The analysis defines jumbos as loans that exceed a county’s government-sponsored enterprise loan limit for 1-unit mortgages. If the county isn’t available, data cover ... [Includes one data chart]


October 24, 2014 - Inside Nonconforming Markets

Banks Increase Jumbo MBS Participation

Two large banks are set to continue their participation in the jumbo mortgage-backed security market, including one deal backed largely by loans from banks that have plenty of capacity to hold mortgages in portfolio. JPMorgan Chase is set to issue a $262.23 million jumbo MBS with originations largely sourced from First Republic Bank and Chase. The deal is backed solely by 15-year fixed-rate mortgages, which many banks have been willing to retain in portfolio in recent…


October 24, 2014 - Inside Nonconforming Markets

Jumbo MBS Characteristics Mixed in 3Q

Underwriting trends for jumbo mortgage-backed securities were mixed as of the third quarter of 2014, according to an analysis by Inside Nonconforming Markets. While some issuers started to include mortgages with higher loan-to-value ratios, average combined LTV ratios in jumbo MBS were actually higher for deals issued in the fourth quarter of 2013 than those priced in the third quarter of 2014. Average credit scores on issuance for the third quarter were ... [Includes one data chart]


October 24, 2014 - Inside Nonconforming Markets

Outlook Cloudy for Non-Agency MBS

It could take years for the non-agency mortgage-backed securities market to even approach the depth and liquidity it had before the housing meltdown, according to experts participating on a panel during the annual convention of the Mortgage Bankers Association this week in Las Vegas. The main reason non-agency MBS issuance does not amount to much is the huge bank demand for jumbo mortgages, said Tom Millon, president and CEO of Capital Markets Cooperative. Only about 77 percent of ...


October 24, 2014 - Inside Nonconforming Markets

QMs in Non-Agency MBS Exempt From Risk-Retention Requirements

The non-agency mortgage-backed securities market got clarity about risk-retention requirements in a new final rule approved this week by six federal regulators. Given current market conditions, it is unlikely to have any impact. The regulators created an exemption big enough to drive a truck through. Sponsors of non-agency MBS backed by qualified residential mortgages are not required to retain a 5 percent interest in the transaction. As expected, the QRM parameters were lined up with ...


October 24, 2014 - Inside MBS & ABS

Credit Unions MBS Holdings Decline; Will They Ever be Players in Jumbo Securities?

Although credit unions have boosted their share of new mortgage production in recent years, they continue to be only modest investors in residential MBS, a situation that isn’t likely to change anytime soon. According to figures compiled by Inside MBS & ABS, the credit union industry held $105.27 billion in residential MBS on its books at June 30, a 2.4 percent sequential decline. Compared to the same period a year earlier, their investment in mortgage securities fell by even more: down 4.8 percent. And that may not be such a bad thing. MBS prices were...[Includes one data chart]


Poll

What is it going to take to convince lenders to loosen the credit box (i.e., remove underwriting overlays)?

The recent rep and warranty changes announced by the Federal Housing Finance Agency should go a long way in protecting lenders from future buybacks and help expand mortgage credit.
There won’t be any significant elimination of underwriting overlays until the government stops seeking huge mortgage-related penalties and settlements from lenders.
There shouldn’t be any expansion of the mortgage credit box since looser underwriting is what caused the recent mortgage crisis.

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