The dispute around an $8.5 billion settlement between Bank of America and non-agency MBS investors may be at an end after a New York state appeals court signed off on the deal. The agreement would mean a quick end to a lengthy legal battle over a settlement that was first announced on June 28, 2011. It also means the agreement could become the template for all representations-and-warranties settlements with large institutional investors, analysts said. BofA agreed...

Over a fifth of the loans securitized last year by Fannie Mae, Freddie Mac and Ginnie Mae do not meet one of the key criteria of the qualified-mortgage standard that came into effect in January 2014, and instead rely on an exemption for agency loans. During 2014, the three agencies securitized $198.3 billion of home loans with debt-to-income ratios exceeding 43.0 percent, according to a new Inside MBS & ABS analysis of loan-level disclosure data. That represented 21.5 percent of total MBS issuance by Ginnie and the two government-sponsored enterprises. The Consumer Financial Protection Bureau requires...

Officials from the Federal Housing Finance Agency as well as the government-sponsored enterprises will give an update on the common securitization platform project at an upcoming technology show – but don’t expect a “beta” test, at least not yet. Over the past two weeks, Inside MBS & ABS had been hearing reports that a private “demo” of the CSP was in the works – and might possibly happen at a technology show later this month in Orlando, sponsored by the Mortgage Bankers Association. FHFA principal strategist Michael Aneiro is scheduled...

The catch was that the so-called GSE "patch" would only last as long as Fannie and Freddie remained in conservatorship...

The representations and warranties used in jumbo MBS can sufficiently handle some breaches but fail to completely protect investors, according to Moody’s Investors Service. In a report released this week, the rating service noted that issuers use two main varieties of reps and warrants: those that allow for an open-ended review of loans and those that employ a prescriptive framework. The open-ended reviews are seen in jumbo MBS from Redwood Trust, WinWater Home Mortgage and others...

Banks have retained a significant volume of newly originated jumbo mortgages and even certain conforming loans in recent years, but analysts at Deutsche Bank Securities stress that the “conventional wisdom” regarding bank demand for MBS is wrong. “Despite anecdotal evidence of banks retaining more whole loans – they are more and more reliant on MBS as a percentage of their overall exposure to residential mortgages than they have been at any point in the past 15 years,” the analysts said in a report released last week. Bank demand for MBS holdings has increased...

The planned transfer of servicing on two non-agency MBS from Ocwen Financial to Select Portfolio Servicing marks the first time in recent years that Ocwen will lose servicing due to a vote by investors. Analysts at Moody’s Investors Service said the servicing transfer on two deals issued by Barclays Capital in 2006 “set a negative precedent” for Ocwen. The transfer was prompted by a vote by investors in the non-agency MBS that came about because Ocwen experienced an event of default due to recent downgrades to the firm’s servicer ratings. “While most of Ocwen’s portfolio has not experienced [defaults based on servicer quality] that would allow for forced transfer, around 695 transactions do have...

Credit unions aren’t major players in the MBS market, and their aggregate holdings declined slightly in 2014, according to a new Inside MBS & ABS analysis of call-report data. Credit unions held $101.3 billion of residential MBS in portfolio at the end of last year. That was down 2.4 percent from the third quarter, and off 3.8 percent from the end of 2013. Most of the industry’s MBS holdings (97.4 percent) were...[Includes one data chart]

This mortgage manager estimates a “good” LO works 50 to 70 hours a week…

Altisource Residential and Altisource Asset Management abruptly cancelled their scheduled earnings calls this week as the firms work on modifying an asset management agreement. Both of the companies have ties to Ocwen Financial, which has faced its own operating issues in recent months. “Despite the negative headlines surrounding our primary mortgage servicer Ocwen, our performance has remained strong,” said Ashish Pandey, AR’s CEO. The real estate investment trust had ...