Most analysts are confident that private mortgage insurance companies will not see their ratings downgraded due to increased competition from the FHA as well as new capital requirements for private MIs proposed by the Federal Housing Finance Agency. But Zacks Investment Research, a research firm that ranks and rates investment products for investors, went against the grain and downgraded MGIC Investment Corp. by two notches due exactly to those reasons. While private MIs have been gaining market share in the last couple of years, Mortgage Guaranty Insurance Corp. and its business competitors will find...

In efforts to expand mortgage access and get more homeowners in the door, Housing and Urban Development Secretary Julian Castro said the FHA is looking into alternative credit scoring models. Speaking at a credit access symposium at the National Association of Realtors this week in Washington, DC, Castro said, “We want to make it more affordable, realistic and more feasible for folks to become homeowners.” He acknowledged...

It’s not just structural issues that are keeping investors away from jumbo MBS; they are finding better value in other non-traditional mortgage securities products, including Fannie Mae and Freddie Mac risk-share transactions and deals backed by seasoned loans. During the fourth quarter of 2014, Javelin Mortgage Investment sold all of its holdings of prime, fixed, senior bonds from new-issue jumbo MBS. The real estate investment trust sold a total of ...

The refinance program for performing, underwater Fannie Mae and Freddie Mac mortgages staggered to a five-year low during 2014, but government officials are thinking about keeping it on life support for another year. The Home Affordable Refinance Program is slated to expire at the end of 2015. Although the Federal Housing Finance Agency has barnstormed around the country trying to drum up business, activity in the program has fallen steadily since ... [Includes two data charts]

Democrats on the House Financial Services Committee have introduced legislation that would provide private and government risk-share coverage to all mortgages, create a single MBS and decommission Fannie Mae and Freddie Mac. Introduced by Reps. Jim Himes, D-CT, John Delaney, D-MD, and John Carney, D-DE, the bill would require Ginnie Mae to run an MBS program that combines private capital with government re-insurance in lieu of the current federal ...

Ocwen Financial pushed back this week against claims from large investors that have worked to remove the nonbank as servicer on 119 non-agency MBS. “By all indications, the holders employed unsupportable assumptions and manipulated their analysis to advance their agenda,” Timothy Hayes, an executive vice president and general counsel at Ocwen, wrote in a letter to the trustees of the MBS in question. The letter was a response to claims made ...

In 2014, Freddie Mac securitized $6.983 billion of re-performing mortgages, double what it did the year prior, and a sign that this niche market is heating up. As for Fannie Mae’s participation in “re-performers,” that’s a different matter entirely. The government-sponsored enterprise has yet to stick its toe in the water, though a spokesman for the company told Inside MBS & ABS that “it’s something we continue to evaluate.” But just how hot might the sector get ...

Nomura Holdings is unlikely to suffer a hit in ratings because of the Federal Housing Finance Agency’s mortgage-backed securities lawsuit, but the litigation may yet prove costly to the Japanese financial holding company, according to a recent report from Fitch Ratings. Nomura went to trial on March 16 to defend itself against allegations that it misrepresented the underlying asset quality of MBS it sold to Fannie Mae and Freddie Mac prior to the financial crisis ...

A bill to replace the Federal Housing Finance Agency with a beefed up Ginnie Mae and set Fannie Mae and Freddie Mac on a path to liquidation has been reintroduced in the House. The Partnership to Strengthen Homeownership Act was first introduced in July 2014 to wind down Fannie and Freddie over a five-year timeframe. Reps. John Delaney, D-MD, John Carney, D-DE, and Jim Himes, D-CT, are the lead sponsors of the measure. They said the bill takes the best ideas from both parties to create a housing finance system that combines the strengths of the private and public sectors.The congressmen agreed that things need to be done differently.

Mortgages with credit scores exceeding 740 continued to dominate the conventional conforming market in 2014, according to a new Inside Mortgage Trends analysis of loans sold to Fannie Mae and Freddie Mac last year. High-score borrowers accounted for 62.0 percent of loans securitized through the two government-sponsored enterprises in 2014. They accounted for an even bigger 66.2 percent of purchase-mortgages loans ... [Includes one data chart]