Redwood Trust is looking to invest in mortgage servicing rights and recently adjusted its accounting for non-agency mortgage-backed security issuance, the real estate investment trust said last week. “The recent decline in the market value of servicing rights – from an historic range of roughly 5 to 6 times the annual servicing fee to approximately 2 to 3 times today – has piqued our interest in an investment in servicing rights,” Redwood said ...

While issuance of non-agency mortgage-backed securities is not particularly attractive for lenders at the moment, banks have been able to turn strong profits by holding nonconforming loans in portfolio. “We’re able to make very good returns” that exceed the profit on selling to the government-sponsored enterprises, said Greg Tallmadge, a vice president at TD Bank. Speaking at the Mortgage Bankers Association’s National Secondary Market Conference this week ...

After growing significantly via the acquisition of portfolios and subservicing, special servicer Walter Investment Management is looking to increase its servicing assets in different ways. Walter is close to establishing delinquency flow programs and will soon increase its agency originations. “The company currently expects to close one delinquency flow program in the second quarter with an additional program to come in the second half of the year,” Walter said this week ...

Two Harbors Investment started acquiring residential properties to offer for rent during the first quarter of 2012, with officials at the real estate investment trust anticipating strong profits from the venture. The final step in establishing an infrastructure for the program was a February agreement with Silver Bay Property Management. “Silver Bay creates the opportunity to bring in institutional excellence to this sector, which heretofore has largely been ...

The Federal Housing Finance Agency’s non-agency mortgage-backed security repurchase claims against UBS can proceed, according to a ruling last week by U.S. District Judge Denise Cote in Manhattan federal court. The decision could also be applied to the other 16 lawsuits the FHFA filed against non-agency MBS issuers. Among other issues, the ruling refuted claims ... [Includes two briefs]

Mortgage servicers could find themselves in a quandary as they implement the national servicing standards outlined in the March foreclosure settlement agreement, especially if they run into conflicting FHA requirements. Compliance experts say that while many of the settlement standards could be carried out within the FHA program without being at odds with existing FHA requirements, conflicts do exist with the guidelines that cannot be resolved. Even when it is technically possible to comply with both FHA guidelines and the settlement standards, it is still going to ...

FHA lenders are anticipating a spike in volume when changes to the FHA Streamline Refinance Program become effective next month. The biggest change to the program taking place on June 11 is the lower upfront mortgage insurance premium, which the Department of Housing and Urban Development had reduced to just 0.01 percent, and the annual MIP, which was lowered to 0.55 percent. The new premium pricing is effective for all streamline refi transactions that are refinancing FHA loans endorsed on or before May 31, 2009. HUD expects the change will ensure that borrowers benefit from a net reduction in their overall mortgage payment and, at the same time, reduce risk to the FHA. The FHA Streamline Refi program allows borrowers with FHA-insured loans who are current on their mortgage to refinance into a new FHA-insured loan without ...

The FHA and the reverse mortgage industry are working on guidelines that would help lenders in the Home Equity Conversion Mortgage program identify unsuitable borrowers. Financial assessment guidelines that are currently in development would limit the pool of HECM applicants to those who can afford to meet the program’s financial obligations in a timely manner, said Jeffrey Lewis, chairman and chief executive officer of Generation Mortgage in Atlanta. HECM loans account for 90 percent of all reverse mortgages originated in the U.S. Loan volume had contracted in the wake of the financial crisis, down ...

Ginnie Mae has announced new data disclosures effective Sept. 1, but investors say it is information they do not need. These include indicators identifying first-time homebuyers, type of third-party originator, and the upfront and annual mortgage insurance premiums. The new disclosures will provide greater transparency on the collateral that backs Ginnie Mae mortgage-backed securities, the agency explained in its latest guidance to program participants. The move also aligns Ginnie Mae’s data disclosures with the industry, it added. Issuers that are unable initially to provide the data will ...

The Department of Housing and Urban Development’s Office of the Inspector General will begin internal audits later in 2012 on various aspects of the FHA single-family mortgage insurance program and release results of some that were begun last year. In August, OIG auditors will begin review of the FHA TOTAL (Technology Open to All Lenders) Scorecard to determine whether the automated underwriting system approves loans that otherwise would not be approved under manual underwriting. Auditors will also check whether the scorecard could ...