Several more court documents were released over the past week that offer additional details into the circumstances surrounding the Treasury Department’s decision to replace the quarterly dividend Fannie Mae and Freddie Mac had been paying in conservatorship with a net worth sweep. Industry observers say the new memos and deposition transcripts reinforce the notion that the government had been planning the sweep for a while before it was implemented in late 2012. The government-sponsored enterprises’ shareholders have been challenging...
As Tim Rood of The Collingwood Group noted: An investor can buy a mortgage at 65 cents on the dollar, “notify the borrower they are eligible for a note mod down to 80 cents on the dollar and voila!”
Since the United Kingdom voted to leave the European Union a week ago, interest rates in the U.S. have been steadily falling, causing a rally in MBS prices. According to market watchers, Fannie Mae/Freddie Mac MBS values for new securities haven’t been this good since January 2015. Meanwhile, mortgage rates touched a three-year low the past few days with some primary market lenders making new loans at 3.25 percent and no points. As Inside MBS & ABS went to press, the benchmark 10-year Treasury was yielding...
Upgrades of ratings on structured finance products hit an all-time high in 2015, according to a study released this week by S&P Global Ratings. The study tracked ratings across sectors and the world, while the U.S. residential MBS sector showed mixed performance. S&P said it had 30,359 ratings outstanding on global structured finance securities at the beginning of 2015. During the year, 9.8 percent of the ratings were upgraded. The rating service said upgrades in 2015 were most prevalent on structured credit deals in Europe and the U.S. Some 11.2 percent of S&P’s ratings were downgraded...
The issuance of prime non-agency mortgage-backed securities in 2016 is well below the relatively meager levels seen in recent years, according to a new ranking and analysis by Inside Nonconforming Markets. Some industry participants have blamed the lack of activity on the Truth in Lending Act/Real Estate Settlement Procedures Act disclosure rule that took effect in October. Although there are signs the market has adjusted to TRID, only two ... [Includes one data chart]
The “Brexit” vote in the United Kingdom last week helped significantly reduce interest rates on new jumbo mortgages. Looking forward, it’s not clear if rates will remain low, which would boost refinance volume, or if banks will make further adjustments. The Brexit vote prompted investors to increase their holdings of 10-year Treasury notes, pushing down yields. Interest rates on mortgages tend to follow trends in the 10-year Treasury, though rates on jumbo mortgages can be ...
The nonprime mortgage-backed security issued last week by Lone Star Funds could spur an increase in MBS backed by non-qualified mortgages, industry analysts say. The $161.71 million COLT 2016-1 Mortgage Loan Trust was the first MBS backed by non-QMs to receive a rating. Some 51.8 percent of the mortgages in the deal were non-QMs. All of the mortgages were originated by Lone Star’s Caliber Home Loans. The A-1 tranche of the MBS priced at spread of ...
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