Two more long-running legacy MBS lawsuits were resolved last week after defendants Goldman Sachs and Deutsche Bank separately agreed to settle with plaintiffs. The NECA-IBEW Health & Welfare Fund, a union pension fund in Decatur, IL, is seeking preliminary court approval of a $272 million settlement with Goldman Sachs on behalf of entities that purchased MBS issued by defendant GS Mortgage Securities and which Goldman underwrote. If approved, the settlement would put...

Fannie Mae and Freddie Mac continue to increase their focus on the multifamily segment, which generated growing income for the two government-sponsored enterprises during the second quarter. Freddie Mac’s comprehensive income for multifamily grew by $102 million to $366 million for the second quarter. The increase was primarily due to higher unrealized gains on available-for-sale-securities. New purchase volume remained...

On Wednesday, Freddie Mac announced that it guaranteed its second multifamily small balance loan securitization. The government-sponsored enterprise expects to guarantee approximately $109 billion in SB Certificates and plans to price them next week.

Investors have a lot more to worry about these days than the collateral damage stemming from problems in Greece and China and a bumpy U.S. stock market. Ratings analysts indicate some new energy-related risks – most notably earthquakes near “fracking” sites and a plunge in the price of oil – have emerged as potentially significant challenges to investors in real estate and to mortgage lenders. Analysts at Standard & Poor’s said in a recent client note that earthquakes in proximity to fracking sites introduce a unique risk factor into the investment equation for those with a stake in real estate located in affected regions. “In particular, determining whether or not earthquake coverage is...

The Mortgage Bankers Association urged the Basel Committee this week to abandon its “overly simplistic” proposal to add onto institutional balance sheets layers of risk-based capital for interest rate risk.

Despite former Federal Housing Finance Agency Acting Director Ed DeMarco's call for comprehensive reform of the nation's housing finance system and Fannie Mae and Freddie Mac, the analysts at Compass Point Research & Trading remain convinced "that there is neither the legislative capacity nor political will to address housing finance reform in this Congress."

More than a year after the Consumer Financial Protection Bureau’s standards for qualified mortgages took effect, originations of near-prime non-QMs remain limited. However, industry participants are optimistic that originations will pick up and Lone Star Funds recently jolted the sector with a non-agency mortgage-backed security. The $72 million non-agency MBS from Lone Star was backed by non-QMs originated by Caliber Home Loans, a lender owned by the private-equity firm ...

Potential issuers of non-agency mortgage-backed securities looking to loosen underwriting standards on loans to be included in MBS are getting tough feedback from rating services. Fitch Ratings said last week that non-qualified mortgages with weak income documentation would likely face a “double penalty” compared with a similar non-QM that meet the documentation standards set for QMs. Non-QMs with “alternative documentation” included in non-agency MBS would ...

Issuance of jumbo mortgage-backed securities has slowed somewhat this summer, with a lack of consensus from industry participants on whether it’s worth participating in the market. Barclays Capital, which helps fund jumbo MBS activity, said the deals offer about 50 basis points of option-adjusted spread compared with agency MBS. Analysts at Barclays said newly-issued jumbo MBS are attractive for investors less concerned about liquidity. Officials at Anworth Mortgage Asset Corp ...

Five Oaks Investment issued its first jumbo mortgage-backed security in April and has plans to significantly increase its activity in the market. “Five Oaks sees a large growth opportunity within the prime jumbo space for institutions with the ability to aggregate, finance, securitize and retain residential mortgage credit risk,” company officials said during a recent presentation to investors. With the $267.2 million Oaks Mortgage Trust 2015-1, Five Oaks aggregated the mortgages in the deal and ...