JPMorgan Chase is preparing to issue the first non-agency MBS that will comply with a securitization safe harbor established by the Federal Deposit Insurance Corp. in 2010, according to presale reports published this week. The $1.89 billion Chase Mortgage Trust 2016-1 received preliminary AAA ratings from Fitch Ratings and Moody’s Investors Service. According to Fitch, Chase will sell only the subordinateclasses to investors, retaining the senior tranche, which accounts for 87.7 percent of the MBS. To meet the FDIC safe-harbor requirements, Chase will also retain...
When the Securities and Exchange Commission issued a final rule in August 2014 setting disclosure requirements for publicly-registered MBS and ABS, one of the outstanding provisions was whether to apply the loan-level disclosure requirements to private-placement 144A deals. More than 18 months later, it’s unclear whether the SEC will increase disclosure requirements for private placements, though industry participants expect that some action is in the works. Charles Sweet, a practice development leader at the law firm of Morgan Lewis, noted that the SEC asked the Structured Finance Industry Group to submit refreshed comments regarding the outstanding provisions included in the so-called Regulation AB2 final rule. “They are...
After starting 2015 with a net decline in supply of outstanding single-family mortgage securities, the market began to rally and ended the year with a modest gain. A new analysis by Inside MBS & ABS reveals that total residential MBS in the market reached $6.412 trillion at the end of last year, an 0.5 percent increase from the third quarter and up 1.0 percent from yearend 2014. The growing supply of residential MBS slightly outpaced the 0.3 percent increase in home mortgage debt outstanding, resulting in a 64.2 percent securitization rate in the fourth quarter. There are...[Includes two data tables]
Loan performance for mortgages modified more than five years ago has been relatively stable even as the loans face higher scheduled interest rates. Analysts at Bank of America Merrill Lynch said payment shock has been limited and servicers appear to be postponing increases for some borrowers. Loans in the Home Affordable Modification Program have a fixed rate as low as 2.00 percent for the first five years, then the interest rate typically increases in steps of 1.00 percent per year until reaching the average market rate that was in effect at the time the mortgage was modified. Many proprietary mortgages, which outnumber HAMP, have similar features. Non-agency mortgages with a total unpaid principal balance of about $33.0 billion experienced...
Opendoor, an online real estate start-up, unveiled a new service this week that lets sellers trade-in one home for another one instead of watching it sit on the market or being forced to juggle two mortgages. The San Francisco-based company launched the program in Phoenix and Dallas with a goal to make buying and selling a home “as simple as trading in a car.” Once sellers find a new home, they go to the Opendoor website, decide on their closing date, and the company will take it from there, including dealing with the new home’s real estate agent along with the title and escrow. To simplify the transaction, the company doesn’t...
Appraisals aren’t causing significant closing problems for purchase-mortgage lending, although there are issues as home prices increase, according to responses to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. “Appraisals are mostly in line with contract prices,” said Tom Popik, research director for Campbell Surveys. “However, appraisals for FHA mortgages and VA mortgages more often miss the contract price than appraisals for conventional mortgages.” Appraised home prices have tended...
Republicans on the House Financial Services Committee are working on a regulatory relief bill as an alternative to the Dodd-Frank Act, many of the regulatory provisions of which have yet to be promulgated more than five years after enactment. Rep. Jeb Hensarling, R-TX, chairman of the committee, made the announcement and revealed some of the details earlier this week during a government relations event sponsored by the American Bankers Association in Washington, DC. “I can report...
The Consumer Financial Protection Bureau has not changed its “corrective and diagnostic” supervisory and enforcement approach towards the industry’s implementation of the integrated disclosure rule known as TRID, and does not expect to bring any enforcement action any time soon unless there is blatant misconduct, CFPB Director Richard Cordray told members of Congress this week. Whether mortgage lenders get any additional, official clarification or guidance from the agency to help with their compliance and litigation concerns is another matter. During a hearing Wednesday of the House Financial Services Committee, Rep. Blaine Luetkemeyer, R-MO, engaged...
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