Sometime during the second quarter of 2019, Fannie Mae and Freddie Mac will begin issuing the new uniform MBS, a completely fungible security that will replace the separate to-be-announced MBS currently issued by the two government-sponsored entities. The Federal Housing Finance Agency announced the deployment date for Release 2 of the single-security initiative this week. The new implementation date was moved back from the previous estimate of some time in 2018. The delay was...
The average daily trading volume in agency MBS declined to $202.4 billion in February, one of the worst readings over the past six months, according to figures compiled by the Securities Industry and Financial Markets Association. In January, volume was a bit healthier at $229.8 billion, but that was before concerns began to mount about President Trump’s business agenda and how successful the new White House might be in rolling back regulations – financial and otherwise. As Inside MBS & ABS went to press this week, fears were...
Presumably the bureau is going to keep bringing enforcement actions like this until a final resolution is reached curbing its authority, the attorney noted…
Observers of the subprime auto ABS market are raising concerns as delinquencies rise above peaks seen during the financial crisis as lenders have loosened underwriting standards in search of market share. According to Fitch Ratings’ index of subprime auto ABS, 60+ day delinquencies on loans backing the securities hit 5.45 percent at the end of 2016. Delinquencies were up from 4.70 percent at the end of 2015 and 41 basis points higher than the peak for the sector in 2009. The index tracks an outstanding balance of $38.6 billion from 149 transactions. There were 21 active shelves in the index, up from 12 active issuers in 2010. “Smaller lenders along with recent new entrants are...
Housing finance reform, especially if it weakens mortgage underwriting standards, could have a negative impact on private-label MBS as well as the government-sponsored enterprises’ credit risk-transfer transactions, according to a newly published report from Moody’s Investor Services. Analysts said that various reform proposals could reduce the influence that Fannie Mae and Freddie Mac have in the market and likely increase credit risk in new MBS in the short-term. Combined with a rising interest rate environment, such reform could have a credit-negative effect. Loan origination processes and the kinds of loans produced could become...
Publicly traded mortgage-banking firms had a rough ride in 2016, which turned out to be a turning point for one of the sector’s stalwarts, PHH Mortgage. The nine publicly traded mortgage lenders tracked by Inside Mortgage Trends posted a combined $563.8 million in net income on their mortgage-banking operations during the fourth quarter. That was up sharply from the third quarter, but it was not enough to offset huge combined losses during the first half of ... [Includes one data chart]
Most lenders aren’t currently using so-called next-generation mortgage technology service providers, according to a survey conducted by Fannie Mae. High costs are among the reasons keeping many lenders from adopting technology that could ease the burdens borrowers face when obtaining a mortgage. Some 63.0 percent of the 184 lenders surveyed by Fannie in November said they haven’t used next-gen tech providers. Fannie released the survey results ...
Mortgage bankers ended a very good year in 2016 on a somewhat offbeat note as overall company profits sagged and production margins shrank. The average mortgage-banking operation generated $3.513 million in pretax income during the fourth quarter of 2016, according to the latest data from the Mortgage Bankers Association. That was down 10.8 percent from the average pretax income in the trade group’s third-quarter Mortgage Bankers Performance report ...
Over the past three years, Walter Investment Management Corp. has posted net losses totaling $902.6 million – more than any other publicly traded mortgage company with the exception of one: Ocwen Financial, which lost $915.6 million over that period. And while Ocwen may finally be turning the corner in terms of both its regulatory problems and negative cashflow, the jury is still out on Walter, which saw its stock price fall to less than 70 cents a share this week ...
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