GSE single-family securitizations rose just under 1.0 percent during the first three months of 2013, compared to the previous quarter, yet it was the single highest level since the second quarter of 2009 as mortgage lenders delivered $355.8 billion in home loans to Fannie Mae’s and Freddie Mac’s securitization programs, according to a new Inside The GSEs analysis. Fannie and Freddie activity peaked in January with GSE volume declining slightly in both February and March. January’s huge increase compared to the previous month may reflect lenders’ intent to hold secondary market sales until the new GSE representation and warranties went into effect on Jan. 1.

In a move designed to allow qualifying members to sell fixed-rate, conforming mortgage loans into the secondary market, the Federal Home Loan Bank of Dallas announced last week it has joined the Mortgage Partnership Finance Program and is now offering the MPF Xtra product. Under the MPF Xtra program, loans are sold through the FHLBank of Chicago to Fannie Mae as a third-party investor.

UBS Americas failed in its bid to shut down a lawsuit brought by the Federal Housing Finance Agency in connection with non-agency mortgage-backed securities purchased by Fannie Mae and Freddie Mac, while in another case three former Freddie executives lost their own bid to dismiss a Securities and Exchange Commission securities fraud case against them. The Second Circuit Court of Appeals last week upheld a lower court’s ruling that denied UBS’ motion to dismiss the FHFA’s suit as time barred. In the summer of 2011, the FHFA filed 18 lawsuits in Manhattan federal court against UBS and other big banks on behalf of the GSEs, alleging violations of the federal Securities Act of 1933 for approximately $200 billion in non-agency MBS sold to Fannie and Freddie.

There’s a growing interest on the part of new investors in buying residential mortgage servicing rights, but observers say a major impediment for the market is a lack of confidence that Fannie Mae and Freddie Mac will acknowledge their ownership rights. “It’s a problem,” said Tom Piercy, managing member of Interactive Mortgage Advisors, a servicing brokerage and advisory firm. “Fannie and Freddie could learn a thing or two from Ginnie.” The phrase “new investors” generally applies...

Moody’s Investors Service said it would not have given its highest rating to the jumbo mortgage-backed security issued last week by JPMorgan Chase because of concerns about the deal’s representation and warranty framework and the lack of risk retention by Chase. DBRS, Fitch Ratings and Kroll Bond Rating Agency gave JPMorgan Mortgage Trust 2013-1 AAA ratings with credit enhancement of 7.40 percent on the top-rated tranche. The rating services said the credit enhancement on the deal was ...

With banks starting to issue jumbo mortgage-backed securities instead of holding originations in portfolio, the sector has expanded beyond the two nonbanks that propped up non-agency jumbo MBS issuance since 2010. The activity shows favorable economics for non-agency MBS, including tighter spreads on interest rates between conforming mortgages and non-agency jumbos. The average interest rate on a 30-year fixed-rate conforming mortgage was 3.596 percent this week, according to Inside Mortgage Finance ...

Ginnie Mae issuance fell in the first quarter of 2013 but was easily offset by significant gains from a year ago, according to Inside FHA Lending’s analysis of FHA data. Mortgage-backed securities production at the government facility dropped 5.1 percent to $104.1 billion in the first quarter but increased 28.6 percent year-over-year , which was more than enough for an offset. The securities were backed mostly by FHA and VA loans with a combined total of $99.33 billion. Federally guaranteed rural housing loans totaling $4.84 billion were also in the mix. Wells Fargo and Chase Home Finance led the Ginnie Mae market with a combined ... [1 chart]

Applications for purchase mortgages surged last week as FHA borrowers rushed to get their applications in before April 1, when higher FHA annual insurance premiums took effect, according to the Mortgage Bankers Association’s latest weekly survey of mortgage loan applications. The boost in total purchase applications for the week ending March 29 was fueled by a nearly 7.0 percent increase in government-backed purchase applications, the MBA noted. “This [increase] was likely driven by borrowers applying for loans prior to the scheduled increase in FHA premiums that took effect on April 1,” said Mike Fratantoni, the MBA’s vice president of research and economics. “On a year-over-year basis, purchase applications are up about 4 percent, in line with the trend we are seeing in home sales volume.” The 10 percent annual premium increase, the third in two consecutive years, applies...

Production of new non-agency MBS and non-mortgage ABS increased sharply in the first quarter of 2013, offsetting a slight decline in the agency MBS market. Total MBS and ABS issuance rose 2.9 percent from the fourth quarter of 2012 to $515.3 billion during the first three months of 2013, according to a new Inside MBS & ABS analysis and ranking. The first quarter of this year was up 19.7 percent from the same period in 2012, and it marked the strongest quarterly issuance since the third quarter of 2009. For a change, the increase did not come...[Includes two data charts]

The Treasury Market Practices Group announced last week that a margining recommendation for agency MBS initially set to be implemented in June will be delayed until the end of 2013. The provisions apply to primary dealers working with four broad categories of forward-settling agency MBS transactions as part of an effort to manage counterparty exposures. The implementation date was delayed in response to concerns from market participants. Timothy Cameron, managing director and head of the Securities Industry and Financial Markets Association’s asset management group, said buy-side participants need to negotiate agreements for each of their accounts, which can include thousands of documents. “It is clear many market participants will not be able...