Credit Suisse has adjusted the representations and warranties included in each of its recent non-agency MBS deals, reacting to criticism from investors that the reps and warrants do not meet models set by the American Securitization Forum. While the new jumbo MBS issued by Credit Suisse last week made some improvements on reps and warrants compared with its previous deals, the issuer continues to experiment with somewhat looser standards. “Credit Suisse has introduced several new elements to the rep and warrant structure in recent securitizations which has caused some diverging opinions in the securitization community,” according to analysts at Bank of America Merrill Lynch. “While the ASF has provided a starting point with their model reps, it will likely take the market some time to find the right balance between investors and originators.” Issuance from Redwood Trust has been seen...

New issuance of agency single-family MBS fell 3.1 percent from January to February, according to a new Inside MBS & ABS analysis and ranking. On a combined basis, Fannie Mae, Freddie Mac and Ginnie Mae issued $153.4 billion in new single-family MBS last month. That was up 31.6 percent from February 2012 and compared favorably with the $138.5 billion monthly average issuance for all of last year. All of the decline came...[Includes one data chart]

It’s far from over, but the years-old plague of mortgage buybacks may be slowly winding down. A new Inside Mortgage Finance analysis of bank call reports reveals that banks and thrifts repurchased “only” $2.97 billion during the fourth quarter of 2012. That was down 2.1 percent from the third quarter, but it marked the fifth straight quarterly decline and it was the lowest level since the second quarter of 2009. It brought total repurchases on single-family mortgages, which include indemnifications, to $13.97 billion for all of 2012, a decline of 33.3 percent from the previous year. It was the lowest annual repurchase volume since 2008. An earlier Inside Mortgage Finance analysis of repurchase disclosures made by Fannie Mae and Freddie Mac showed...

The Mortgage Bankers Association urged the Consumer Financial Protection Bureau to give all FHA loans a “conclusive presumption of compliance” with qualified mortgage requirements and to revise the QM annual percentage rate/average prime offer rate (APR/APOR) threshold for FHA loans at least until the agency issues its own QM rule. Failure to make the adjustments could severely restrict the availability of FHA loans to lower-income first-time homebuyers, which is the FHA’s traditional market, the trade group said. In comments on the CFPB’s final ability-to-repay rule, the MBA said...

When a lender like Wells Fargo – the top lender and servicer in the industry – describes a lengthy list of “pain points” in the new loan originator compensation rule issued by the Consumer Financial Protection Bureau, it’s fair to conclude the rule presents a huge challenge for mere mortals. During an Inside Mortgage Finance webinar last week on the bureau’s final rule, Amy Thoreson Long, senior counsel in the consumer lending division of Wells’ law department in Minneapolis, started with one of the most visceral issues for lenders: the human impact. “One of the big key things here is...

Mortgage originations last year increased by some $435 billion from 2011 and virtually all of that gain came from refinance activity. Unless housing activity begins to grow significantly faster, mortgage lending volume appears likely to drop significantly in 2013. Prodded along by the suddenly successful Home Affordable Refinance Program, refi lending increased by $403 billion last year, a 41.9 percent increase over 2011. And although a number of indicators suggested that housing sales were beginning to firm up, home-purchase mortgage originations were up just 6.3 percent – a gain of $32 billion – compared to the previous year. In fact, purchase-mortgage originations have been...[Includes three data charts]

The group of regulators that established the $25 billion national servicing settlement with five servicers is in negotiations to expand the settlement’s requirements and monetary penalties to other servicers. Some servicers involved in the negotiations are willing to comply with the servicing requirements but objecting to paying any penalties. “We continue to have productive discussions with the state regulators, state attorneys general and the [Consumer Financial Protection Bureau] on adopting standards similar to the national mortgage standards adopted by the big banks,” Ronald Faris, president and CEO of Ocwen Financial, said last week during the company’s earnings call for the fourth quarter of 2012. “Ocwen Loan Servicing and other servicers have also been asked...

Billions of dollars in mortgage servicing rights have changed hands over the past two years – and the selling is far from over. The question now is how much more will be sold by the end of 2013. According to analysts who cover nonbank buyers of MSRs – and other sources – $1 trillion to $1.5 trillion in rights could transfer over the coming 18 to 24 months, though some of that is in the form of subservicing contracts. “Over the next year the figure could be...

Congress has expressed interest in an industry proposal for new shared-risk arrangements involving private mortgage insurers and the FHA to cut the government’s exposure to losses and help protect future FHA borrowers from getting into loans they cannot afford. The proposal was presented in separate testimonies during recent House and Senate committee hearings on FHA solvency and the need for reforms to strengthen and protect the Mutual Mortgage Insurance Fund and avoid any potential bailout by taxpayers. In a Senate Banking, Housing and Urban Affairs Committee hearing, Teresa Bryce Bazemore, president of Radian Guaranty, urged...

Warehouse banks that extend credit to nonbank residential lenders ended the fourth quarter with almost $40 billion in commitments on their books, their best quarter of the year, according to exclusive survey figures compiled by Inside Mortgage Finance. The top five warehouse banks – which control about half of the estimated total market – had $19.9 billion of commitments on their books, a 4 percent improvement from the third quarter. Compared to the end of March, commitments were up 37 percent. Wells Fargo, the largest buyer from correspondents, ranked...[Includes one data chart]