The staff of Rep. Jeb Hensarling, R-TX, is putting the finishing touches on a plan to reform the nation’s housing-finance system, but several lobbyists and trade group officials question what impact the proposal will have.
Citadel Servicing Corp., which has been working on its first MBS deal backed by non-qualified mortgages for six months, killed the transaction this week, industry sources familiar with the matter told Inside MBS & ABS.
Efforts to enhance disclosures on MBS and ABS in recent years have generated mixed results, according to industry participants. Inadequate disclosures helped contribute to the financial crisis, according to investors that suffered significant losses on MBS and ABS.
Marketplace lenders participating in the ABS sector predict that issuance will increase this year due to strong demand from investors and an ample supply of new originations.
The Structured Finance Industry Group wants to make sure any housing-finance reform bill ensures continued liquidity in the MBS market. The Wall Street group recently penned a letter to Sens. Bob Corker, R-TN, and Mark Warner, D-VA, to give feedback on a draft version of the Senate bill.
A New York bankruptcy judge has ordered the bankruptcy estate of Lehman Brothers Holdings to pay $2.38 billion to cover legacy residential MBS claims filed by trustees in 2008.
Hensarling is chairman of the House Financial Services Committee, which means any Fannie Mae/Freddie Mac reform bill must first go through his panel, whether he’s the author or not.
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