Banks and savings institutions in the second quarter of 2013 reported the lowest volume of mortgage repurchases and indemnifications since the buyback blight really bit into the industry four years ago, according to a new call report analysis by Inside Mortgage Trends. Banks and thrifts reported $2.671 billion in mortgage repurchases and indemnifications during the second quarter, the industry’s lowest since the second quarter of 2009, when buybacks totaled $2.059 billion ... [Includes one data chart]

The secondary market for mortgage servicing rights is starting to look a bit frothy, so much so that many bulk offerings today garner upwards of 12 bidders per auction. A year ago just a handful of investors showed up. But that isn’t deterring Michael Lau, CEO of Pingora Asset Management, who earlier this year raised $500 million to buy MSRs. Lau said Pingora is plowing ahead with its acquisition plans, careful not to overpay while concentrating on “flow” deals on new originations. “We’re actively doing...

New issuance of agency single-family MBS fell in August to its lowest monthly total of the year, according to a new market analysis and ranking by Inside MBS & ABS. Fannie Mae, Freddie Mac and Ginnie Mae generated a total of $130.88 billion of new single-family MBS last month, down 9.3 percent from July. It was the lowest monthly production volume since December 2012. New issuance by the government-sponsored enterprises fluctuated sharply at that time as lenders jockeyed around rising guaranty fees and the implementation of more favorable reps and warranties policies. All three agencies saw...[Includes one data chart]

Standard & Poor’s this week threw another counterpunch against the federal government’s civil fraud lawsuit filed earlier this year, slamming the litigation as “retaliation” for the rating agency’s August 2011 downgrade of the country’s AAA credit rating. The Justice Department in February filed a $5.0 billion lawsuit accusing S&P of knowingly inflating its ratings in residential MBS and collateralized debt obligations to boost its revenue and market share in the years leading up to the 2008 financial crisis. The filing in the U.S. District Court in Santa Ana, CA, by S&P’s parent company McGraw-Hill Co. seeks...

FeatherStone Investment Group has entered the fledgling real-estate-owned-to-rental securitization sector with a new program that allows broader investor participation in the transaction. Other securitized REO-to-rental deals only pay investors coupon and principal cash flows derived from rents on the properties, the company noted. FeatherStone’s program, on the other hand, would allow investors to participate in both the immediate rental cash flow as well as the potential capital gains from the sale of the properties in the deal. FeatherStone’s deal will be financed...

Fewer borrowers are using FHA financing, which has enabled private mortgage insurers to take back more market share from the FHA, according to Inside FHA Lending’s analysis of industry data. Borrowers are shying away from FHA due to higher mortgage insurance premiums (MIPs) that took effect early this year and to the new policy eliminating MI cancellation. Private MIs accounted for 36.6 percent of primary mortgage insurance written in the second quarter, their highest level since 2008. This was up from 32.7 percent in the first quarter and from 30.5 percent a year ago. Private MIs also provided coverage on ...

The Federal Housing Finance Agency is expected to announce lower loan limits for Fannie Mae and Freddie Mac sometime this fall, a move that warms the hearts of non-agency jumbo originators everywhere, but is causing consternation among certain factions of the market, in particular, Realtors and the California Mortgage Bankers Association. “Any reduction in the loan limit will have a huge impact on the California market,” said Susan Milazzo, executive director of the CMBA. “We’re a high-cost state.” The trade group executive told...

Fannie Mae and Freddie Mac mortgage-backed securities remained the preferred investment choice of the 12 Federal Home Loan Banks during the second quarter of 2013, with a negligible increase from the previous quarter, according to a new analysis and ranking by Inside The GSEs based on data from the Federal Housing Finance Agency. Meanwhile, Ginnie Mae securities posted a modest but noticeable decline within the FHLBank system during the period ending June 30, 2013. GSE MBS accounted for 73.9 percent of combined FHLBank MBS portfolios, up 1.9 percent from the first quarter. The Finance Agency’s data do not separately break out Fannie and Freddie volume or share.

The sale of residential mortgage servicing rights (MSRs) tied to Ginnie Mae mortgage securities is gathering steam with a handful of large deals currently in the market. Bank of America recently held an auction for $22 billion of legacy Ginnie MSRs, according to investment bankers familiar with the offering. Final bids were being taken this week. A winner has yet to be declared. A spokesman for BofA told Inside FHA Lending that in general the bank does not comment on MSR sales, though it has made exceptions when unloading very large packages. Earlier this year, for example, it sold just over ...

Fitch Ratings updated its loss model criteria for non-agency jumbo mortgage-backed securities this month, including new default estimates that vary by origination channel. Other rating services take the origination channel into account when rating new jumbo MBS, but not necessarily to the extent that Fitch has taken. “Fitch has determined that loans originated through a direct retail channel have a lower default risk than those originated through a broker, correspondent or wholesale channel,” the rating ...