Redwood Trust boosted its net income in the first quarter of 2018 and continued to increase its originations of expanded-credit mortgages. The real estate investment trust is seeing strong demand for the loans in the secondary market and Redwood is set to issue its largest expanded-credit mortgage-backed security to date. Redwood had $46.9 million in net income in the quarter, up 51.4 percent from the fourth quarter of 2017 and up 26.7 percent from a year ago. The company sold ...
Most real estate investment trusts that specialize in the agency MBS market allowed their portfolios to decline slightly in the first quarter of 2018, according to a new Inside MBS & ABS analysis. [Includes one data chart.]
Fannie Mae and Freddie Mac continued to whittle away at their retained mortgage portfolios during the first quarter, though the pair still had $469.3 billion of MBS and whole loans on their books at the end of March. [Includes one data chart.]
Fitch Ratings last week upgraded 18 non-agency MBS backed by seasoned loans. The deals had been issued in recent years and performed better than the rating service expected.
Ginnie Mae has reinstated one of two VA lenders it suspended last month for alleged loan churning practices that triggered rapid prepayments in the agency’s MBS.
Spreads on mortgage-backed securities with non-qualified mortgages have tightened in recent years, according to S&P Global Ratings. “Since non-QM deals first appeared in 2014, their AAA spreads have tightened, suggesting that the market may be growing more comfortable with this asset class,” the rating service said. The spread measures the price of MBS tranches compared with a benchmark international swap rate. Tighter spreads indicate greater demand from investors ...
The share of cash-out mortgages in prime non-agency MBS has increased in recent years, prompting concerns from Moody’s Investors Service. The rating service noted that the cash-out refi share increased from around 1.0 percent in early 2012 to around 8.0 percent in the second half of 2017. The cash-out refi share has been even higher in some recent issuance. Such loans accounted for 14.9 percent of the $736.5 million deal JPMorgan Chase issued this week ...
With overall production levels falling, there was a modest increase in several risk vectors of FHA and VA loans pooled in Ginnie Mae mortgage-backed securities during the first quarter of 2018.A new Inside FHA/VA Lending analysis shows the average credit score for FHA loans in Ginnie MBS issued during the first quarter was 671.1, the lowest level since Ginnie began reporting loan-level data on its securities. That was down from 673.2 in the fourth quarter and 679.2 a year ago. Part of the slide in FHA credit scores likely reflects the increased share of purchase mortgages, which typically have lower scores than refinance loans. The same thing happened in the VA market, where average credit scores fell 1.1 points to 707.8 in the first quarter. A year ago, the average VA score was 710.2. Debt-to-income ratios also drifted higher, suggesting more risk of default. Among FHA loans, the average DTI rose to ... [Charts]
An approved issuer suspended last month due to alleged VA loan churning activities is back in Ginnie Mae’s multi-issuer mortgage-backed securities program. Nations Lending, ranked 97th in Inside FHA/VA Lending’s top 100 VA lenders, was reinstated after reaching a confidential agreement with Ginnie Mae, according to a source familiar with the case. The Ohio-based lender has been “fully reinstated and [again] able to use all of Ginnie Mae’s programs that are available for lenders in good faith,” said the source, who asked not to be identified. The source declined to provide details of the agreement, maintaining Nations has been very transparent and was “ahead of the curve” in terms of dealing with the churning problem. “Nations began addressing the issue even before Ginnie took action,” he said. Ginnie neither confirmed nor commented on the report. “The evidence will show what is happening in the ...
RSS