Companies that make their living from servicing delinquent and “high touch” mortgages may want to reconsider their business options going forward. According to new figures compiled by Inside Mortgage Finance, late payments on home mortgages continued their downward trend in the fourth quarter with the nation’s top servicers recording a combined delinquency rate of 9.48 percent, a 141 basis point improvement over the same period a year earlier. Compared to the third quarter, late payments fell 74 bps, another sign that the problem loans are...[Includes one data chart]
Mortgage industry representatives strongly support efforts by the Consumer Financial Protection Bureau to lessen the potential for double counting in loan originator compensation calculations for “qualified mortgages” under the CFPB’s recently issued ability-to-repay final rule. And they’d like the bureau to go even further. When the CFPB issued its ATR rule last month, it also proposed adding two comments and potentially one of two others to the accompanying commentary that would specify calculation methods to lessen the problem of double counting of loan originator compensation in the points and fees calculation for QM loans. The first comment, “exemption for consumer paid mortgage broker/brokerage compensation,” would clarify...
The five servicers participating in the $25 billion national mortgage servicing settlement could complete their borrower relief obligations well before the 2015 deadline, according to a report released late last week by the settlement’s monitor. However, complaints from borrowers regarding servicing are increasing, with greater scrutiny expected from the Consumer Financial Protection Bureau and the possibility of further requirements as part of the settlement. The five servicers participating in the settlement have $20.0 billion in consumer relief requirements and provided $45.8 billion in gross relief to borrowers through the end of 2012 as part of the settlement. However, most of the servicers have not yet met their relief requirements as the loss mitigation must be provided via a number of different tactics credited at varying levels. Short sales accounted...
Recent and impending changes to FHA program requirements have shifted purchase-mortgage activity to other sources, according to industry analysts. While the FHA remains the go-to financing method for borrowers who can only provide a 3.5 percent downpayment, conventional financing with a 5.0 percent downpayment is seen as more favorable for qualified borrowers. Beginning April 1, the annual FHA mortgage insurance premium will increase by 10 basis points for purchase mortgages, following a number of other premium increases in recent years. FHA financing accounted...
With the Federal Reserve’s MBS portfolio quietly passing the $1 trillion mark in mid-February for the first time since late 2010, Fed Chairman Ben Bernanke this week continued to toe the party line on the historic level of support the central bank has provided to the MBS and Treasury markets. But there is more skepticism from Republicans on Capitol Hill and some Fed board members, and industry analysts are trying to dope out when the Fed buying spree will wind down. “After quadrupling its balance sheet engaging in unprecedented MBS asset purchases and creating an extended negative real interest rate environment, there is...
Credit Suisse this week obtained ratings on its first non-agency jumbo MBS of 2013 in a deal that includes sunsets for certain representation and warranties as well as a contribution from Two Harbors Investment, which has been working for years to issue non-agency MBS on its own. The $425.67 million CSMC Trust 2013-TH1 received AAA ratings from Fitch, DBRS and Standard & Poor’s. The top-rated tranche had a credit enhancement of 7.05 percent, well above the 5.85 percent level on Credit Suisse’s previous deals but in line with recent Redwood transactions. DBRS said...
Sallie Mae is set to issue the first ABS of the year backed by private student loans, a market that is expected to reach 2012 levels although student loans are drawing more scrutiny from the Consumer Financial Protection Bureau. Sallie’s SLM Private Education Loan Trust 2013-A will have an initial pool balance of $1.31 billion and it’s expected to receive a AAA rating, based on a presale report from Standard & Poor’s. Some $27.1 billion in federally-backed and private student loan ABS was issued...
Commercial banks and savings institutions boosted their holdings of non-mortgage ABS to a record $164.5 billion as of the end of 2012, according to a new Inside MBS & ABS ranking and analysis based on call report data. That was up 3.1 percent in just three months and represented a 19.1 percent jump from the fourth quarter of 2011 – although some of that year-long gain reflected the fact that thrifts did not begin filling out call reports until last year. It’s still a significant increase...[Includes one data chart]
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