Favorable shifts in macroeconomic conditions have contributed to a rise in single-family rentals and an increase in the investment in these properties by institutional buyers, prompting Moody’s Investors Service to release its criteria for rating the emerging single-family rental securitization market. The criteria come four months after Moody’s rated Invitation Homes 2013-SFR. The rating agency awarded $278.7 million in triple-A ratings for the largest tranche of the deal. “A slowly improving economy will boost...

Ginnie Mae will begin scrutinizing issuers which, for reasons unknown, have not issued a single Ginnie Mae mortgage-backed security since obtaining their approval. Ginnie Mae President Ted Tozer said he is assigning staff to investigate the underlying cause of issuer inactivity. “We’re starting that process now to find out what their plans and objectives are to try to get a better handle on what’s going on,” he explained. With the growth in new issuers, agency staff has focused on making sure that newcomers are transitioning smoothly and are up to speed on what is happening in the mortgage securities market. But there are those that have remained inexplicably dormant. Tozer admits that agency staff is spread quite thin and the agency has been hiring more account executives lately to monitor all program participants to ensure there are not more early failures. New issuers typically go through a ...

Private-equity firms such as Orange Capital and EJF Capital have been gobbling up shares in PHH Corp. the past year, believing the stock is undervalued. Among other things, “smart money” investors have noticed that the liquidation value of its mortgage servicing rights almost equals the entire company’s market capitalization rate. But that doesn’t mean PHH Corp. will be successful in its attempt to unlock shareholder value by selling off parts of the company, including its mortgage banking franchise and automobile fleet business. “The only thing that’s certain about PHH is that it’s trading below book value,” said one mortgage executive who has conducted business with the firm. Late this week, PHH common was selling...

Credit Suisse late last week issued its second jumbo MBS of the year, both of which have largely consisted of mortgages from New Penn Financial. Redwood Trust is also planning to issue its first jumbo MBS of the year in the coming weeks, though officials at the real estate investment trust are pessimistic about the short-term outlook for jumbo MBS issuance. Credit Suisse’s latest jumbo MBS was a $297.4 million deal with ratings from DBRS and Standard & Poor’s. The AAA tranche had credit enhancement of 8.85 percent and no presale reports on the deal were published. Officials at Redwood have cited...

Although investors and participants initially showed a great deal of interest in the fledgling market for bonds backed by single-family rental properties, rating agencies are starting to take a closer look at the business and don’t like everything they see. “Rising U.S. home prices have pushed down rental yields in many single-family rental markets, a trend that will likely discourage some institutional investors from buying distressed properties and converting them into rental units,” according to a recent report from Moody’s Investor Service. The rating agency adds...

Loan correspondents and mortgage brokers continue to play a major role in the agency mortgage market, accounting for 42.9 percent of loans securitized by Fannie Mae, Freddie Mac and Ginnie Mae in 2013, according to a new Inside Mortgage Trends analysis. Correspondents accounted for most of the third-party originations securitized by the agencies, and Wells Fargo was the top producer of these loans. Just over half of the loans sold by Wells were ... [Includes one data chart]

Non-agency mortgage lending staged a minor revolt in 2013, reversing two years of increasing domination of the market by Fannie Mae, Freddie Mac and Ginnie Mae. The only growth spots in the mortgage market last year were in jumbo originations and home-equity lending, according to a new ranking and analysis by Inside Mortgage Finance. Jumbo production surged 20.9 percent from 2012 levels to an estimated $272 billion – the strongest output for the sector since 2007. Home-equity lending was...[Includes two data charts]

Kara Stein, a commissioner at the Securities and Exchange Commission, said the SEC needs to take action regarding the rating services. It was one of many recent MBS-related calls for action directed at the SEC, from the agency's leadership, Congress and industry analysts. "We need to finally and firmly address the conflicts of interest in asset-backed securitizations and the provision of credit ratings," Stein said in a speech late last week. She noted...

Officials at Redwood Trust, the leader in issuance of jumbo mortgage-backed securities since 2010, suggested this week that issuance of jumbo MBS from the firm this year likely won't hit the level seen in 2013. "Our preferred distribution for jumbo loans is securitization since we can retain attractive investments for our portfolio," Brett Nicholas, Redwood's president, said this week on a call with investors. "Today, however, whole-loan sales offer better execution." He said...

The wait for new disclosure requirements for non-agency mortgage-backed securities was extended this week as the Securities and Exchange Commission re-opened the comment period for the so-called Reg. AB2. The requirements for disclosures on new non-agency MBS and other asset-backed securities were first proposed in 2010. The SEC was set to approve a final Reg. AB2 rule earlier this month but is now reconsidering due to privacy issues. The delay comes as ...