Boosted by acquisitions from Homeward Residential and Residential Capital, Ocwen Financial handled a whopping 33.7 percent share of the subprime mortgages outstanding at the end of the first quarter of 2013, according to a new ranking by Inside Nonconforming Markets. Three major special servicers are in negotiations to acquire more than $300 billion in unpaid principal balance of mortgage servicing each in the next year. While the servicers have broadened their focus to include ... [Includes one data chart]
Exactly one year after it filed for bankruptcy, Residential Capital announced this week it has entered into a “comprehensive plan support agreement” with its parent, Ally Financial, and ResCap’s creditors, who say they are owed some $25 billion in mortgage liabilities. The plan gets Ally out from under the threat of billions of dollars in lawsuits by settling all existing and potential claims between Ally and ResCap and all potential claims held by third parties related to ResCap that could be brought against Ally and subsidiaries that are not Chapter 11 debtors. The settlement, which is subject to approval by a federal bankruptcy court in Manhattan, fully releases...
The Federal Reserve’s MBS purchase party isn’t over – yet – but it looks like the nation’s central bank is getting nearer to the last call. Late last week, the Wall Street Journal reported that officials at the nation’s central bank have developed a strategy for dialing back their unprecedented level of support of the housing market. The plan involves reducing the amount of bonds the Fed buys “in careful and potentially halting steps,” the WSJ said, with the purchases varying on the read officials have of the job market and of inflation. And although the timing of the Fed’s wind-down is...
Risk-sharing transactions using credit-linked notes may be one path toward the goal of getting the government-sponsored enterprises out of conservatorship, experts told members of the Senate Banking Subcommittee on Securities, Insurance and Investment this week. The current GSE MBS market provides trillions of dollars of financing to the mortgage market while government guaranties and other structural features are required to maintain this market, according to Andrew Davidson, president of Andrew Davidson & Co. “As any part of GSE reform, I believe...
Shellpoint Acceptance Corp. hopes to come to market with its first non-agency MBS by summer, securitizing not only jumbo loans, but a host of mortgages that fall outside Fannie Mae and Freddie Mac underwriting guidelines for different reasons. According to a recent filing with the Securities and Exchange Commission, the company has committed $2 billion in capital to its shelf registration, though its first deal will be smaller than that. Shellpoint refers...
Freddie Mac is offering $1.0 billion of its non-agency MBS holdings for sale, according to a spokesman for the government-sponsored enterprise, part of efforts to meet requirements set by the Federal Housing Finance Agency. Fannie Mae also plans asset sales of some sort, but wouldn’t commit to selling its non-agency MBS holdings. Freddie held $70.28 billion in non-agency MBS at the end of the first quarter of 2013 and Fannie held $31.22 billion. The GSEs purchased the non-agency MBS before 2009 and have allowed the holdings to run off ever since. The FHFA recently required...
While non-agency MBS participants largely oppose a credit rating assignment system proposed by Sen. Al Franken, D-MN, some of the main players in the market endorse a model based on ratings rotation. At a roundtable hosted by the Securities and Exchange Commission this week, Martin Hughes, CEO of Redwood Trust, said issuer-paid rating conflicts could be reduced by requiring non-agency MBS issuers to alternate rating services so that one firm didn’t rate more than two consecutive deals from the issuer. He noted that Redwood has established a self-imposed rotation between Moody’s Investors Service and Standard & Poor’s on its non-agency MBS issuance. “The requirement to frequently alternate among the nationally recognized...
All three pistons in the mortgage origination engine slowed down during the first quarter of 2013, but retail production came closest to keeping the pace in a declining market, according to a new analysis and ranking by Inside Mortgage Finance. Lenders produced an estimated $310.0 billion in originations through retail offices, bank branches, call centers and online activities during the first three months of 2013. That was down 0.9 percent from the previous quarter, but because overall production slipped 4.8 percent, the retail share of the market surged to a record 62.0 percent. The wholesale channel – both correspondent and broker – accounted...[Includes four data charts]
Mortgage delinquency rates declined during the first quarter of 2013, according to an index compiled by Inside Mortgage Finance based on 19 lenders that service a total of $6.04 trillion in home mortgages. The overall delinquency rate index fell from 9.47 percent at the end of 2012 to 8.70 percent at the end of the first quarter. That was the lowest level since the third quarter of 2008. There were...[Includes one data chart]
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