The disclosure rule recently issued by the Securities and Exchange Commission aims to reduce reliance on credit ratings in the structured finance market, an issue that federal regulators have long grappled with. The SEC’s Regulation AB took effect in 2006, and it included a requirement that publicly offered securities have an investment-grade rating. The so-called Reg AB2 finalized by the SEC in August eliminates the rating requirement and instead sets a number of new requirements for publicly issued deals. Beginning in November 2015, the CEO of the depositor of publicly issued...

The Securities and Exchange Commission’s release of a final rule setting loan-level disclosure requirements for certain structured finance products has only slightly reduced the uncertainty regarding the impact of the so-called Reg AB2 requirements. Among other issues, the SEC left parts of its initial proposal from 2010 unfinished, with no indication of if or when further action will be taken. For example, the SEC had originally proposed extending loan-level disclosure requirements to the 144A private-placement market in addition to requiring such disclosures for certain SEC-registered securities, including residential MBS, commercial MBS, ABS backed by auto loans and re-securitizations of such collateral. At the recent ABS East conference produced by Information Management Network in Miami Beach, Rolaine Bancroft, a senior special counsel at the SEC, said...

Thanks to a heavy supply of scratch-and-dent deals and a rebound in jumbo mortgage securitizations, new issuance in the non-agency MBS market jumped by 57.4 percent in the third quarter of 2014, according to a new Inside MBS & ABS analysis and ranking. A total of $8.99 billion of non-agency MBS were issued during the third quarter, a major increase from the $5.71 billion issued in the previous three-month period. Year-to-date issuance was still off 27.3 percent from the first nine months of 2013, and it is doubtful that annual volume this year will top 2013’s total when the year is over. Issuance of prime non-agency MBS in the third quarter was...[Includes three data charts]

Analysts at Bank of America Merrill Lynch are predicting a solid fourth quarter for jumbo MBS, enough to bring the total for 2014 up to about $8.0 billion when the year is over.

Another refi boomlet? One Long Island-based mortgage executive told us this: “Locks doubled from the day before and are up 30 percent over the previous 10 days”…

Mortgage underwriting standards are relaxing somewhat, according to a new analysis by Inside Mortgage Finance, particularly as production has shifted from a focus on refinances to purchase mortgages. However, underwriting standards are much more stringent than they were before the financial crisis, with few options available for nonprime borrowers. The average credit score on purchase mortgages included...

The U.S. Supreme Court gets another crack at deciding whether plaintiffs can bring a disparate-impact lawsuit under the Fair Housing Act (and by extension, the Equal Credit Opportunity Act), a question that has divided courts, lenders and consumer advocacy groups for years. The court’s partial grant of the petition in the Texas case would be its third opportunity in two years to rule on the controversial question. Two prior cases raising that issue, Township of Mount Holly v. Mt. Holly Gardens Citizen Action, Inc. and Magner v. Gallagher, were both settled before oral argument could be presented before the court. SCOTUS has agreed...

Affordable housing advocates are continuing their full-court press against the head of the Federal Housing Finance Agency, demanding that the FHFA greenlight financing for the dormant National Housing Trust Fund after a setback in federal court. U.S. District Court Judge Marcia Cooke of the Southern District of Florida last week dismissed a lawsuit brought by the National Low Income Housing Coalition on the grounds that the NLIHC lacks standing to sue the FHFA. Cooke also found that the court does not have jurisdiction over the decisions of the agency. The coalition filed...

One GSE source close to the CSP project noted that Yanoti was one of the platform’s “leaders,” but cautioned that “there are others as well.”

The Mortgage Bankers Association is on a mission to convince banking regulators to revisit the Basel III capital standards and to change the cap on how much mortgage servicing rights can count toward Tier I capital. The way things stand now, MSRs will be capped at 10 percent of capital when the rule is fully phased in, with the excess deducted from a depository’s “common equity.” Previously, the cap was 100 percent. In a draft letter to the Federal Reserve, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency, the MBA argues...