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...
The price of agency MBS has been rising since early April, which can only mean good things for publicly-traded real estate investment trusts that own the asset class. However, REIT share prices haven’t improved much of late, with some companies such as Annaly Capital Management continuing to trade closer to their 52-week lows than their highs. Late this week, for instance, Annaly – one of the largest MBS investing REITs – was trading at $11.30 compared to a 52-week high of $15.98 and a low of $9.66. But better days may be...
The chairman and CEO of CapWealth Advisors – a private equity firm with stakes in the GSEs – was critical of all the housing reform bills introduced so far and the premise that Fannie and Freddie need to be wound down to affect reform.
Since late last year, the FHFA has decreed that it must approve any GSE servicing sale of 25,000 loans or more, which translates into roughly $5 billion of product.
Negative spreads between a fixed-rate HECM loan and advancing future funds at a fixed rate could endanger servicers’ capacity to meet their obligations under the HECM MBS program,
Why doesn’t the MBA, NAHB and National Association of Realtors just come out and say what they really mean, which is this: Leave Fannie and Freddie alone, return them to their shareholders and they’ll never buy another ALT A or subprime mortgage again.
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