Investors in auto loan ABS may need to buckle up. Both prime and subprime auto loan ABS have weakened month-over-month and year-over-year, according to S&P Global Ratings. “Collateral performance in the U.S. prime auto loan ABS sector was weaker in July, with net losses and 60-plus-day delinquencies increasing month-over-month, while recovery rates decreased,” the S&P analysts said. “Collateral performance for the subprime sector deteriorated...

Retail lending through brick-and-mortar branches and consumer-direct programs was the biggest production channel in conventional mortgage lending but had a somewhat smaller share in government-insured lending, according to an exclusive analysis by Inside Mortgage Finance. Retail production played a dominant role in the jumbo market, where it accounted for 79.3 percent of originations over the 18-month period ending in June 2016. Correspondent production played a meaningful role, accounting for 16.1 percent of jumbo originations, but brokers (4.6 percent) had a relatively thin share of the jumbo market. Brokers’ strength was...[Includes one data table]

Originations of mortgages to first-time homebuyers in recent years have performed better than other purchase mortgages securitized by the government-sponsored enterprises, according to an analysis by Moody’s Investors Service. The stronger performance of first-time homebuyers occurred even as purchase mortgages for repeat buyers tend to have stronger borrower characteristics. The rating service suggested that tighter underwriting coupled with borrower education and counseling have improved the performance of GSE first-time homebuyer mortgages. Moody’s said...

Although single-women borrowers are more likely to pay their mortgages on time than single-male borrowers, they tend to pay higher mortgage rates and are more often denied credit. Those findings come from a new Urban Institute study that merged Home Mortgage Disclosure Act data for 2004-2014 with CoreLogic data on loan performance. A combination of a male and female borrower (usually in that order) accounted...

Issuance of single-family agency MBS rose 6.9 percent from July to August, according to a new ranking and analysis by Inside MBS & ABS. Fannie Mae, Freddie Mac and Ginnie Mae issued a combined $138.25 billion of single-family MBS last month, their strongest aggregate monthly output since July 2013. Agency production volume has risen for six straight months since bottoming out in February of this year. Although the purchase-mortgage market has gotten most of the attention in recent months, it was...[Includes two data tables]

Lone Star Funds is preparing to issue a $216.97 million MBS backed by newly originated nonprime mortgages, according to presale reports published this week. The deal will help the market for new nonprime MBS outpace issuance of jumbo MBS, at least momentarily. Last month, Deephaven Mortgage issued a $154.33 million MBS backed by new nonprime mortgages and Angel Oak Capital Advisors issued a $132.65 million MBS, neither of which received credit ratings. Lone Star’s COLT 2016-2 is scheduled to close next week. Two jumbo MBS were issued...

Investor demand for nonprime whole loans is increasing – which is a good thing for primary market originators – but will it create problems for firms that want to issue securities? In some quarters, there’s a concern that if enough investors appear, it will increase whole-loan prices, making securitization less economical and therefore more difficult. “We’re definitely seeing...

With Ginnie Mae MBS issuance at record levels these days, agency officials continue to worry about the growing proliferation of nonbanks in the sector and the fact that they control so much of the business now. But don’t get Ginnie Mae wrong. The government-backed MBS guarantor likes nonbanks – it just wishes they had more capital and liquidity. At least that’s the view of agency Senior Vice President of Issuer and Portfolio Management Michael Drayne. “We’re...

The first rated post-crisis non-agency MBS backed by a significant share of nonperforming mortgages paid off recently, offering insights into how the deal performed and how investors fared. The $372.80 million Mortgage Fund IVc Trust 2015-RN1 was issued by Bayview Asset Management in October 2015. It received “A” ratings from Fitch Ratings and Morningstar. Fitch said it capped its rating “due to the idiosyncratic and adverse-selection risks associated with NPL collateral.” At issuance, 34.9 percent of the loans were nonperforming and 78.0 percent had been modified. The rating services said...

The National Credit Union Administration gets another chance to recover MBS losses incurred by a now-defunct federal credit union, while The Royal Bank of Scotland and Massachusetts Mutual Life Insurance announce a confidential settlement agreement to resolve the latter’s MBS claims. The U.S. Court of Appeals for the Ninth Circuit has vacated a 2015 order by the Central District of California dismissing NCUA’s claims on behalf of failed Western Corporate FCU, which the agency placed in conservatorship in March 2009 and later in liquidation. The agency is acting as liquidating agent for Wescorp against Nomura Home Equity Loan, Inc. The NCUA filed...