Allegations in an impending government MBS fraud case against Moody’s Corp. will likely mirror allegations of fraud and misrepresentation in a 2013 civil suit against Standard & Poor’s, according to industry observers. Moody’s disclosed the expected case in a recent filing of third-quarter earnings results with the Securities and Exchange Commission. According to the credit rating agency, lawsuits are likely pending from both the Department of Justice and state attorneys general over ratings of MBS in the years leading up to the financial crisis. In a letter dated Sept. 29, 2016, the DOJ informed...
Fannie Mae this week joined Freddie Mac in announcing a front-end credit-risk transfer pilot that will use additional levels of private mortgage insurance, but the so-called deep MI option looks like a long shot. “Credit-risk transfer is the next big thing, and though we’re already three years into it, it’s still very much a work in progress,” said Donald Layton, Freddie’s CEO, during the annual convention of the Mortgage Bankers Association in Boston this week. “About 50 percent of the credit risk that’s coming in is...
New issuance of commercial mortgage securities increased substantially during the third quarter, with both the private and agency sectors posting solid gains, according to a new Inside MBS & ABS analysis. A total of $53.14 billion of income properties were securitized during the third quarter, a 33.4 percent increase from the previous period and the strongest three-month output since the second quarter of last year. That brought year-to-date issuance to $137.74 billion, off 12.4 percent from the pace set in the first nine months of 2015, and it would take a huge fourth-quarter surge for the market to reach last year’s total. Non-agency commercial MBS production rose...[Includes one data table]
Late this week, a spokesperson for Ginnie Mae could not offer any specifics about the revised acknowledgement agreement but noted the changes are “almost” complete.
Recapitalizing Fannie Mae and Freddie Mac is a good idea, according to the Congressional Budget Office, which said that it wouldn’t significantly change how the government-sponsored enterprises operate today, but it would help stabilize the mortgage market and the federal budget. In response to several legislative proposals calling for the GSEs to build capital, the CBO recently published a report studying the effects of an “illustrative policy option.” Fannie and Freddie capital will...
The Internal Revenue Service has decided to hold off on making changes to its Secure Access Program, which governs the process by which federal tax transcripts are provided to the mortgage industry, after industry trade groups objected. The changes, part of an effort by the agency to better protect taxpayer data as well as IRS systems from attacks by cybercriminals, had been scheduled to kick in at the start of this week. “To ensure a smooth transition, the IRS has decided...
An agreement by a Chinese international financial holding group to acquire Genworth Financial for approximately $2.7 billion, or $5.43 per share, would give China a foothold in the U.S. mortgage insurance market. Announced on Oct. 23 by Genworth, the sale follows the planned sale of market leader United Guaranty to Arch Capital Group, a global provider of mortgage insurance and reinsurance based in Bermuda. The entire Genworth family of companies, including the MI division, is...
The share of home sales that experienced a delayed closing because of appraisal-related issues remained elevated in September, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. Industry participants suggest that the strong market for purchase mortgages has led to a backlog of appraisals. Appraisal issues accounted...
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