While the deal includes many non-QMs and IOs, along with a “tier 3” representation and warranty framework, the senior tranche of the MBS will include credit enhancement of 5.75 percent.
Home-equity lending cooled off in the third quarter of 2016 as consumers took advantage of low interest rates to refinance rather than draw down more second-mortgage debt. Lenders originated an estimated $50.7 billion of home-equity loans during the third quarter, including home-equity lines of credit and closed-end second mortgages. Although that was down 5.2 percent from the second quarter, it still marked the second highest three-month volume since the housing market collapse in 2008. And depository institutions, the dominant lenders in the HEL market, reported...[Includes three data tables]
Roughly $20 billion in mortgage servicing rights are now available for bulk purchase in the secondary market compared to just a few billion a month ago. The reason: higher interest rates. According to servicing advisers interviewed by Inside Mortgage Finance this week, the 75 basis point jump in rates since the election has suddenly transformed a glum-looking market into one that has great potential. “There’s...
Subservicing specialists ended the third quarter with an estimated $1.80 trillion of contracts on their books, an 11.8 percent sequential gain and a 22.4 percent improvement from the same period a year ago, according to exclusive survey figures compiled by Inside Mortgage Finance. At the end of September, subservicers handled 17.8 percent of the $10.12 trillion residential loan market. A year ago, the sector had a market share of 14.8 percent. Some of the growth comes...[Includes one data table]
Legislation introduced in the last weeks of the 114th Congress would push Fannie Mae and Freddie Mac deeper into the risk-sharing pool, including forcing them into a front-end structure they have so far resisted. The “Taxpayer Protections and Market Access for Mortgage Finance Act of 2016” would require the Federal Housing Finance Agency to push the two government-sponsored enterprises to transfer at least 400 basis points of their total risk. While it’s not clear how the legislation intends this to be measured, it appears...
The Federal Reserve late last week reported a modest 0.6 percent increase in the volume of single-family mortgages outstanding during the third quarter of 2016, the fifth straight quarterly gain in a market finally recovering from the housing meltdown. Still, at $10.123 trillion, the supply of mortgage debt outstanding was $1.118 trillion below the level it reached at the end of 2007. Most of the growth in the third quarter came...[Includes two data tables]
Appraisal-related issues cause more than one out of every 10 purchase-mortgage applications to be denied, according to CoreLogic. Below-contract appraisals comprised 11.3 percent of the first-lien purchase-loan appraisals ordered through the CoreLogic/FNC Collateral Management System, according to Yanling Mayer, director of research in CoreLogic’s office of chief economist. The CMS is a workflow and compliance platform used by many lenders, servicers and appraisal management companies. Mayer noted...
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