So far a “broad cross-section” of industry participants and other stakeholders support the steps the Federal Housing Finance Agency has taken to establish a new securitization platform for residential MBS, the agency said in a progress report issued this week. “In light of the importance of this initiative to the housing finance system, and reinforced by the comments received from the public, FHFA has directed the enterprises to move forward on the development of the [common securitization platform],” the agency noted. In early March, FHFA Acting Director Edward DeMarco said...
Fannie Mae is discouraging some of its newly minted seller/servicers from issuing MBS through swap transactions and is instead pushing them toward its “cash window,” according to lenders and advisors familiar with the issue. “Fannie has increased its due diligence on lenders to ensure they are meeting, or are able to meet, the terms and conditions of an MBS issuance,” said Tim Rood, managing partner in The Collingwood Group, a Washington-based advisory firm. Rood, a former Fannie executive, told...
Fannie Mae, Freddie Mac and Ginnie Mae pumped out a respectable $152.3 billion in new single-family MBS in April, according to a new Inside MBS & ABS market analysis and ranking. April’s issuance level was up 2.6 percent from March and reversed, at least temporarily, a two-month downturn in new production. The cyclical peak for the agency MBS market came back in November 2012, when a whopping $199.4 billion in new securities were issued. Although the market couldn’t sustain...[Includes one data chart]
Although a number of major correspondent lenders pulled back from that market in 2013, a hefty 29.1 percent of home mortgages were funded by one company and then sold, servicing released, to a larger aggregator and, typically, securitized by Fannie Mae, Freddie Mac or Ginnie Mae. That means total production figures that include correspondent lending significantly overstate the concentration in the mortgage origination sphere. Including its correspondent production, for example, Wells Fargo put its fingerprint on 27.7 percent of new mortgages originated in 2012. But the company’s direct originations – loans generated through its retail channel and funded through mortgage brokers – represented...
Encouraged by what it describes as positive public feedback, the Federal Housing Finance Agency says it is pressing forward with its proposed contractual and disclosure framework to enhance transparency and investor protections in residential mortgage-backed securities. The progress report issued this week by the FHFA addresses work that the agency and the two government-sponsored enterprises have done so far in the development of the contract and disclosure framework, or CDF, as well as on the design of a common securitization platform, or CSP. The combination of the CDF and CSP “will enable...
The high-profile ability-to-repay rule and its “qualified mortgage” standard issued earlier this year by the Consumer Financial Protection Bureau is still a work in progress, as mortgage lending industry representatives continue to work the regulators for additional changes and clarifications before the January 2014 implementation. Last week, in meetings with CFPB personnel, officials from the Mortgage Bankers Association pressed for changes and additional guidance on the final rule. The CFPB recently issued a proposed rule to clarify a number of issues related to the January ATR rule. Many of the issues the trade group raised last week were not addressed...
The Treasury Department strongly defended the Home Affordable Modification Program this week after criticism and calls for changes from the Special Inspector General for the Troubled Asset Relief Program. The Obama administration is also considering extending HAMP, which is currently set to expire at the end of this year. “Data show that the majority of homeowners who receive assistance from HAMP have a high likelihood of long-term success to avoid foreclosure, and that HAMP modifications continue to outperform private industry modifications,” said Andrea Risotto, Treasury’s spokesperson for HAMP. She was responding...
Mortgage lenders that do business with Fannie Mae and Freddie Mac are bracing for higher net worth minimums required by the two government-sponsored enterprises, but that doesn’t mean their representatives at the trade groups will go down without a fight. David Stevens, president of the Mortgage Bankers Association, told Inside Mortgage Finance that he has met with Ed DeMarco, acting director of the Federal Housing Finance Agency, “several times” to discuss net worth and related issues affecting lenders. However, DeMarco may not be in the job much longer if the nomination of Rep. Mel Watt, D-NC, to head the agency clears the Senate. The White House this week nominated...
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