A lender that focuses on investment properties is preparing to issue a non-agency MBS backed by adjustable-rate mortgages on residential and commercial properties. The deal shares some characteristics with non-agency MBS backed by new loans, but it’s different in a lot of ways. The planned $358.60 million Velocity Commercial Capital 2016-1 received provisional AAA ratings this week from Kroll Bond Rating Agency. Residential properties account for 55.3 percent of the collateral, with small commercial properties making up the rest. All of the mortgages backing the planned MBS are for investment properties. Velocity Commercial Capital issued...
Ginnie Mae is shutting down its long-running Targeted Lending Initiative (TLI) because it has not made much of an impact on lending to underserved urban and rural areas in recent years. Launched in 1997, the TLI was designed to encourage lenders to finance housing in underserved areas through a reduced guaranty fee. In 2005, the program played a major role in offering relief and financial assistance to homeowners in areas hardest hit by Hurricane Katrina. Under the TLI, Ginnie Mae’s guaranty fee is reduced...
Pingora Asset Management, one of the largest investors in “flow” mortgage servicing rights arrangements, is about to become the property of the nation’s largest real estate investment trust focused on the MBS market, Annaly Capital Management, New York. The purchase of Pingora’s parent, Hatteras Financial, Winston-Salem, NC – a deal valued at $1.5 billion – was unveiled last week, but one important facet regarding Hatteras garnered little in the way of press attention: that it just happens to own Pingora, which at last check laid claim to roughly $76 billion in MSR assets. However, not all of the servicing rights will become...
The chairman of the Senate Committee on Banking, Housing, and Urban Affairs signaled this week that Congress is unlikely to take up comprehensive legislation to reform the government-sponsored enterprises before the presidential election this fall. Committee Chairman Richard Shelby, R-AL, asked the Government Accountability Office to publish a report on a variety of issues involving the GSEs and their potential future structure by Nov. 1. Shelby’s deadline could be ambitious for such a complex issue: a report published last week by the GAO on issues with nonbank mortgage servicers was requested back in October 2014. The timeline suggests...
Two years after the Consumer Financial Protection Bureau’s ability-to-repay (ATR) rule went into effect, residential mortgage servicers have yet to see borrower claims being brought, according to a new report from Fitch Ratings. However, Fitch says the landscape could change as certain non-qualified mortgage loans become more common. But for now, the lack of borrower claims is not surprising, the report said. Most loans, including those eligible for purchase by Fannie Mae and Freddie Mac, meet...
Relatively strong pricing for a jumbo mortgage-backed security issued at the end of March appears to have done little thus far to open the spigot for deals that include loans subject to the TRID mortgage disclosure rule. The $331.95 million Agate Bay Mortgage Trust 2016-2 was issued by Two Harbors Investment at the end of March. The deal included 43 mortgages subject to TRID, many of which had initial compliance exceptions. Analysts at Interactive Data said ...
Bank of America and JPMorgan Chase are using somewhat different strategies for conforming mortgages eligible for sale to the government-sponsored enterprises. Both banks are originating significant amounts of conforming mortgages and retaining some of the loans in portfolio instead of delivering them to the GSEs. BofA said its mortgage-banking income has declined due to holding mortgages in portfolio while Chase sold some of the credit risk on its conforming mortgage ...
Caliber Home Loans was assessed by Moody’s Investors Service as an originator of “expanded-credit” mortgages last week. Caliber is the first lender to receive a rating from Moody’s for expanded-credit mortgages, which could pave the way for the first rated non-agency mortgage-backed security that includes non-qualified mortgages. The rating service defined Caliber’s expanded-credit mortgages as non-agency mortgages that are not prime jumbo loans. Moody’s said ...
Underwriting standards on the four prime non-agency mortgage-backed securities issued in the first quarter of 2016 loosened marginally compared with the typical prime jumbo MBS issued in recent years, according to a new analysis by Inside Nonconforming Markets. The combined loan-to-value ratio on prime non-agency MBS issued in the first quarter of 2016 averaged 69.8 percent. That was somewhat higher than the average combined ... [Includes one data chart]
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