Potential issuers of new non-agency MBS are looking to establish representations and warranties that provide less protection for MBS investors, according to Fitch Ratings. The rating service said it will take a negative view on deals with reps and warrants that vary from the rating service’s standards, which largely mirror guidelines established by the American Securitization Forum. In a report released this week, Fitch said firms looking to issue non-agency MBS have been shopping deals with reps and warrants weaker than the new framework established by the Federal Housing Finance Authority for repurchase requests from the government-sponsored enterprises. The FHFA’s framework, which went into effect in January, includes a sunset for underwriting reps and most fraud reps if a borrower makes 36 consecutive timely payments, which Fitch said would not necessarily unduly expose MBS investors to greater losses. Rui Pereira, a managing director and head of U.S. residential MBS ratings at Fitch, said...