Industry reaction to Obama’s speech was generally favorable, particularly as it related to his call for continued, unfettered access to the 30-year FRM.

Stated-income loans are being offered at 5.49 percent as long as the borrower puts down 20 percent. Meanwhile, Walter wants to keep its contract terms with Fannie Mae secret.

Redwood Trust had a $2.6 billion pipeline of non-agency jumbo mortgages at the end of the second quarter of 2013. While that usually wouldn’t cause much concern for the real estate investment trust, the loans were originated before interest rates on 30-year fixed-rate non-agency jumbos spiked by 100 basis points. The increase, beginning in mid-May, caused spreads on non-agency jumbo MBS to widen significantly. However, officials at Redwood stressed this week that the non-agency MBS market didn’t ...

PennyMac Mortgage Investment Trust plans to issue its first non-agency jumbo mortgage-backed security in the third quarter of 2013 by combining $393.0 million of non-agency jumbos it recently acquired in a bulk transaction with mortgages from its correspondent lenders. The real estate investment trust said it acquired $107.0 million in non-agency jumbos via its conduit in the second quarter, along with $8.0 million in the first three months of 2013. “Jumbo originations have been affected by the ...

President Obama this week endorsed a reduction in the FHA’s high-cost loan limits and called on the Federal Housing Finance Agency and the Department of Housing and Urban Development to consider further decreases to reduce conforming loan limits. The proposal was included in a fact sheet that accompanied Obama’s speech this week on housing. The FHA’s high-cost loan limits are scheduled to be reduced at the end of this year. “HUD and FHFA should closely examine using their existing authorities to reduce ...

One of the last non-agency jumbo mortgage-backed securities issued before the securitization market effectively closed in 2008 is the subject of similar lawsuits by the Department of Justice and the Securities and Exchange Commission. Bank of America issued the $855.7 million security in January 2008, as well as originated and serviced the loans included in the MBS. The regulators cite internal reports from BofA as well as email communications among employees to allege that BofA provided inadequate ...

Credit Suisse issued its latest non-agency jumbo mortgage-backed security last week and, in a change of pace, included a significant portion of 15-year fixed-rate mortgages in the deal. The $597 million CSMC Trust 2013-6 included mortgages that have seasoned for an average of three months with a weighted-average coupon of 3.56 percent, according to a rating report from DBRS. The seasoning on the mortgages wasn’t out of the ordinary compared with other recent issuance by Credit Suisse, but the average ...

The government-sponsored enterprises’ holdings of vintage nonprime mortgage-backed securities declined in the second quarter of 2013 due to sales as well as runoff. Fannie Mae and Freddie Mac are working toward the goal set by the Federal Housing Finance Agency to sell 5.0 percent of the non-agency and less liquid mortgage-related assets they held in their retained portfolios at the end of 2012. Combined, the government-sponsored enterprises held $96.48 billion in nonprime MBS as of ... [Includes one data chart]

A unique lawsuit against Morgan Stanley was recently allowed to move forward though legal analysts questioned the ruling. The lawsuit charges Morgan Stanley with racial discrimination, claiming that the investment bank violated the Fair Housing Act by encouraging New Century Financial to offer high-risk mortgages to African-American borrowers. Disparate impact cases typically target originators, but New Century is long out of business. Morgan Stanley was hit with the lawsuit because it was ...

Three non-agency mortgage-backed security trustees filed lawsuits this week against Richmond, CA, which plans to use eminent domain to purchase mortgages with negative equity. The city recently sent letters to servicers and trustees of non-agency MBS offering to purchase 624 mortgages. If the MBS trustees do not sell the loans for the offered price of 80 percent of the current value of the properties, Richmond Mayor Gayle McLaughlin, a member of the Green Party, said the city intends to ...