The supply of single-family home loan debt in early 2016 grew for the fourth consecutive quarter to hit $10.008 trillion, its highest level in three and a half years, according to Federal Reserve data released late last week. The first-quarter gain was a modest 0.2 percent from the end of last year, and a 1.5 percent increase from March 2015. But the servicing market is a slow-changing glacier, and steady increases over the past year are another indicator that the mortgage market has largely recovered from the housing recession. Most of the gain came...[Includes two data tables]
Seneca Mortgage Servicing LLC, which entered the business just three years ago, has decided to outsource the monthly processing of loans to Nationstar, a sign that private-equity firms are no longer so enamored with the returns generated by mortgage servicing rights. According to a statement issued by Nationstar, it will service all of Seneca’s $50 billion portfolio and any rights Seneca might obtain going forward. Moreover, it will take control of the firm’s Depew platform in upstate New York. No terms were disclosed. However, according to interviews with servicing advisors, Seneca – whose backers include The Blackstone Group, EJF Capital and Arbor Commercial Mortgage – may not be...
According to investors in scratch-and-dent TRID mortgages and traders who play in the space, auctions of mortgages with errors (of all sorts) have continued apace ever since the CFPB announcement on TRID 2.0 rulemaking in early May and show little sign of slowing down. At the same time, the TRID mortgage disclosure rule appears to be less of an obstacle for the jumbo mortgage-backed securities market these days as JPMorgan Chase prepares a deal that will include residential loans subject to the rule.
Commercial banks and thrifts reported a further decline in their holdings of non-mortgage ABS during the first quarter, according to a new Inside MBS & ABS analysis of call-report data. As of the end of March, banks held a combined $131.96 billion of ABS in their portfolio, including assets intended to be held to maturity as well as those available for sale. That represented a 2.3 percent drop from the end of 2015, and a hefty 15.9 percent decline from a year ago. It was...[Includes two data tables]
A $161.71 million MBS planned by Lone Star Funds backed by newly originated nonprime mortgages received an A rating this week from DBRS and Fitch Ratings. The deal is the first post-crisis nonprime MBS to receive a credit rating and it will be the largest post-crisis nonprime MBS issued to date. The rating services stressed that while the mortgages originated by Lone Star’s Caliber Home Loans are generally nonprime, the underwriting on the loans is relatively strong. However, Fitch said it capped the rating at A due to the limited nonprime performance of Caliber and Hudson Americas, the asset manager for the MBS. “As more post-crisis non-prime performance is established while upholding appropriate controls, Fitch will consider...
Fannie Mae plans to start issuing MBS backed by single-family, fixed-rate re-performing mortgages later this year. This week, the government-sponsored enterprise detailed some of the types of loans that will be included in the planned issuance. Both loans that cured on their own and mortgages that received a modification will be eligible for the new RPL securitization program. Among other factors, the mortgages must have been performing for at least six months. Loans modified via the Home Affordable Modification Program will be eligible for the MBS along with loans modified through the GSE’s proprietary mod programs. A number of different loan types will be excluded...
The so-called TRID-lock seen in the jumbo MBS market since October appears to be easing as both Redwood Trust and JPMorgan Chase have come to market with deals that include some loans with compliance problems. Before this week, only one jumbo MBS included mortgages subject to TRID, a deal from Two Harbors Investment in March. Many industry participants blamed...
The average daily trading volume in agency MBS climbed to $215.9 billion in May, the highest reading of the year, according to the Securities Industry and Financial Markets Association. But don’t get too excited. May’s activity is still below the two-year high established in January 2015 and nowhere near the peaks established back in 2008 when crumbling financial markets caused investors to go gaga for agency MBS. The relatively low daily trading volumes continue...
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