Overall FHA production fell significantly in all 50 states in 2013 apparently due to mortgage insurance premium increases and policy changes that made it difficult for even qualified borrowers to obtain an FHA-insured single-family loan. FHA volume by state dropped 27.5 percent in the fourth quarter to $35.8 billion, from $49.4 billion in the previous quarter, with all states showing varying percentages of decline during the period. Year over year, production by state declined by 9.2 percent, data showed. Total FHA originations were $211.3 billion for 2013, with the first quarter ending strongly with $63.7 billion. Production, however, lost steam over the next three quarters. Among the top five FHA states, Virginia suffered the largest quarterly drop, 35.2 percent, in FHA volume. California was the top FHA producer state with $35.2 billion for a ... [2 charts]

Ginnie Mae will provide a one-month grace period to April 30, 2014, for issuers to complete the submission of their master agreement to the Master Agreement Management System (MAMS) within the agency’s enterprise portal. The deadline for submission is March 31, 2014. The master agreements must first be accepted by the MAMS before an issuer may request or receive a “Transfer of Issuer Responsibility.” Failure to comply with this requirement could adversely affect the issuer’s ability to obtain commitment authority and to issue new pools or receive pool transfers. Although many issuers have resubmitted their master agreements, some found it difficult to complete the process within the required timeframe, according to Ginnie Mae. Providing a one-month grace period would help issuers to complete their resubmission. Issuers that still experience ...

The biggest decline in MI-insured business was in underwater mortgages that were refinanced while keeping their existing coverage under the Home Affordable Refinance Program.

Did the FHFA late last summer/early fall raise concerns regarding a certain nonbank servicer’s capital in regard to a huge portfolio of mortgage servicing rights that it had bought earlier in the year from a megabank?

Early indicators suggest that mortgage originations slumped by about 23 percent in the first quarter of 2014, a harbinger of tough times to come for companies that are running on fumes. According to a new Inside Mortgage Finance analysis of loan-level data in Fannie Mae and Freddie Mac first-quarter securitizations, primary market originations for the first three months of the year totaled about $235 billion. Unless the pace picks up, 2014 could fail to reach $1 trillion for the first time since 1998. Lender surveys, which are the major factor in Inside Mortgage Finance originations estimates, are underway. Weak origination volume is...

New issuance of non-mortgage ABS surged to $49.68 billion in the first quarter of 2014, a strong 33.0 percent increase from the previous quarter, according to a new Inside MBS & ABS market analysis and ranking. The first three months of 2014 represented the strongest quarterly ABS issuance number since the third quarter of 2009, when $53.27 billion of new deals were issued. It was up a modest 1.7 percent from the strong start in 2013. All the major asset classes posted...[Includes two data charts]

The equipment-backed ABS sector will likely have another good year this year, and investor interest remains strong, according to a senior analyst at the DBRS credit rating service. “For the equipment finance industry in 2014, we are moderately optimistic,” Chuck Weilamann, senior vice president at DBRS, said during a teleconference last week. “We’ve certainly seen delinquencies and charge-offs hit lows, with a five-year low achieved in 2013.” Not surprisingly, DBRS made...

Standard & Poor’s announced late last week that it placed 96 ratings from 20 servicer-advance ABS on watch for a potential downgrade and the rating service plans changes to its rating criteria for servicer-advance ABS. Industry analysts suggest that the actions could disrupt the market for servicer-advance ABS, as S&P has been the dominant rating service in the sector. S&P said downgrades on servicer-advance ABS are possible because the analysis that accompanied ratings on certain deals didn’t consider subordinated interest amounts as part of the ratable promise. “The CreditWatch placements reflect...

Companies that have received government subpoenas for electronically stored information (ESI) in connection with federal investigations of financial fraud and other white-collar crimes might find some relief in two recent court rulings, according to a recent legal analysis. In a Dechert LLP legal update, attorneys Ben Barnett, Rebecca Kahan and Nathaniel Hopkins said heightened anti-fraud activities at the Department of Justice and the Securities and Exchange Commission have resulted in increased criminal prosecutions, criminal probes and enforcement actions. Many of these actions have shown...

At the end of February, Ocwen Financial issued a $123.6 million security backed by mortgage-servicing rights on agency mortgages, the first of its kind. The security was attractive to investors as well as to nonbanks, with more transactions expected, according to the Urban Institute’s Housing Finance Policy Council. The transaction has a 14-year debt obligation and was secured by Ocwen-owned MSRs on mortgages with an unpaid principal balance of approximately $11.8 billion. Investors in Ocwen Asset Servicing Income Series 2014-1 receive a monthly payment of 21 basis points of the unpaid principal balance of the reference pool in the form of an interest-only strip, along with certain other payments. In a new analysis, the HFPC’s Laurie Goodman and Pamela Lee said...