The securitization of income-property mortgages nosedived in the first quarter of 2017, with most of the downturn in the volatile non-agency sector, according to an Inside MBS & ABS analysis. A total of $48.29 billion of MBS backed by commercial properties was issued in the first quarter, down 27.7 percent from the previous period. Although production was down 6.1 percent from the same period in 2016, it was close to the average quarterly volume of $49.35 billion that the market has produced since the beginning of 2014. The average for the 2011-2013 period was just $32.00 billion. Average volume is...[Includes one data table]
The Securities and Exchange Commission has opened an investigation into certain single-family rental securitizations and is requesting information from market participants, including Green River Capital, a subsidiary of a private mortgage insurance company. The investigation first came to light when Radian Group disclosed in a recent 10-Q filing that Green River received a letter from the SEC requesting information regarding broker price opinions that GRC provided on properties included in SFR transactions. Green River, which falls under Radian’s Clayton Holdings affiliate, is...
Fannie Mae and Freddie Mac are soliciting industry feedback on a proposal designed to make their mainstay credit-risk transfer deals more accessible for real estate investment trusts and, to a lesser extent, overseas investors. REITs have nibbled at the CRT debt notes issued by the two government-sponsored enterprises over the past few years, but restrictions on their holdings of so-called non-REIT assets have limited their involvement. The GSEs, with the backing of the Federal Housing Finance Agency, have come up...
Federal Housing Finance Agency Director Mel Watt is prepared to allow Fannie Mae and Freddie Mac to build some type of capital buffer to avoid a Treasury draw that could weaken investor confidence. But some lawmakers vehemently disagreed with his views during a hearing in the Senate Banking, Housing and Urban Affairs Committee this week. Watt reiterated his concern about the declining capital buffer, which is scheduled to reach zero by 2018 under the preferred stock purchase agreements that set the terms of the conservatorships of the two government-sponsored enterprises. With no capital buffer, Fannie and Freddie would be forced...
An affiliate of NMI Holdings, Emeryville, CA, has issued a $211.3 million, 10-year credit-linked bond aimed at laying off risk at its mortgage insurance affiliate National MI. The notes were issued by NMI affiliate Oaktown Re Ltd. in three tranches: $98.61 million that filled the M-1 class, $98.61 million (M-2), and $14.1 million (B-1). The yields, respectively, are LIBOR plus 225 basis points, LIBOR plus 400 basis points, and LIBOR plus 575 bps. According to Robert Smith, National MI senior vice president of pricing and portfolio analytics, investors that bought the credit-linked notes were...
Fannie Mae and Freddie Mac continued to shrink their retained investment portfolios in the first quarter of this year by focusing on paring their MBS holdings. The two government-sponsored enterprises held a combined $560.04 billion in their retained mortgage portfolios at the end of March. That was down 1.9 percent from the previous period and 16.7 percent below year-ago levels. At their current pace, Fannie and Freddie are...[Includes one data table]
PennyMac has announced that, effective immediately, for FHA, VA, Fannie Mae and Freddie Mac transactions, lenders may provide Equifax’s The Work Number verification of employment, or a written VOE from an equivalent income-verification company in lieu of tax transcripts for salaried borrowers. The Work Number is a user-paid VOE database acquired by Equifax in February 2007. The written VOE must have full income figures supporting the qualifying income, said PennyMac. For all loans closed on or after June 15, 2017, the 2016 tax transcript will be required, unless the file contains evidence an extension was filed along with a copy of the Internal Revenue Service notice for 2016 showing “no record of return filed.” For all loans closed on or after Dec. 15, 2017, 2016 tax returns and tax transcripts will be required. PennyMac reminded lenders that its underwriting system cannot respond to ...
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