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...
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...
An investor in Alt A MBS originally issued by Residential Capital Corp. filed suit this week to block Nationstar Mortgage from auctioning nonperforming loans from the MBS pools. Nationstar in mid February began auctioning NPLs on auction.com, according to the complaint filed in the Supreme Court of New York State this week. There are currently two additional auctions totaling some $750 million of NPLs listed on the internet auction site, both believed to be related to Nationstar. The company is...
MBS investors can expect fewer scratches and dents in non-agency MBS portfolios, according to a new analysis from Moody’s Investors Service that says houses are less likely to lose value in a recovering market and modified loan recoveries are increasing as borrowers make more payments before re-defaulting. Part of the story is that the market is seeing higher recoveries for defaulted modified mortgages than for unmodified defaulted loans. “Even though modifications on loans that were eventually liquidated in 2010 and 2011 exposed the properties to further price depreciation by delaying their liquidation, those modified loans on average still realized higher recoveries than did defaulted unmodified loans,” analysts at Moody’s said. “This is because loan modifications, even failed ones, usually enable...
A federal appeals court last week revived a previously dismissed class-action lawsuit against four financial institutions brought by investors that purchased a $1.32 billion offering of MBS that later turned sour. The U.S. Court of Appeals for the Second Circuit vacated and reversed a lower court’s decision to dismiss the case two years ago against the Royal Bank of Scotland Group, Deutsche Bank AG, Wells Fargo Advisors and NovaStar Mortgage. The New Jersey Carpenters Health Fund was lead plaintiff. In 2007, the New Jersey fund sued...
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