Ginnie Mae would play a greater role in a private-market partnership model envisioned in proposed housing finance reform legislation introduced recently by House Democrats. However, many in the industry doubt whether a Democrat-sponsored reform bill will pass in this Congress. Sponsored by Reps. John Delaney (MD), John Carney (DE) and Jim Himes (CT), the Partnership to Strengthen Homeownership Act would put Ginnie Mae in charge of all single- and multifamily mortgage-backed securities with government backing. Among other things, H.R. 5055 would create a new Ginnie Mae MBS for conventional mortgages backed by the full faith and credit of the federal government with minimum support from the private sector. Under the proposed model, private entities would assume up to 5 percent of the first-loss capital on the MBS. The remaining 95 percent would be shared between ...

Ginnie Mae is now approving applications to issue agency mortgage-backed securities in as little time as six months, a far cry from two years ago when it took as long as 24 months, according to figures provided to Inside FHA Lending. In fiscal year 2013, which ended September 30, the agency approved 77 out of 122 new issuer applications. Since the beginning of the current fiscal year through April, the agency has processed 47 new applications resulting in 20 approvals. A spokesman for Ginnie noted that the number of applications processed in fiscal 2014 was impacted “by the government shutdown” but also by the development of a new online application tool that will be rolled out this year. “The time it takes to get a Ginnie Mae approval has been getting better – as in faster,” said David Lykken, managing partner of Mortgage Banking Solutions, a consulting and advisory firm. “It’s true that the number of ...

Charge-offs in the credit-card ABS sector reached a new low in the first quarter of 2014, due mostly to a steady decline in delinquencies and lower bankruptcy rates, according to Fitch Ratings. Loss rates continued to break new records heading into 1Q14, falling to 2.89 percent during the latest March distribution period, even as average charge-offs dropped to a record 3.00 percent for 1Q14 from 3.04 percent in 4Q13. “This marks 15 consecutive quarters of improvement and is approximately 25 percent lower year-over-year,” said Fitch Ratings Credit Card ABS Group Managing Director Michael Dean and Director Herman Poon in a new report. Late payments also fell...

A new Inside Mortgage Finance analysis of agency mortgage-backed securities data shows that mortgage production fell sharply in virtually all states during the first quarter. The top three states – California, Texas and Florida – fared somewhat better than the overall market. Fannie Mae, Freddie Mac and Ginnie Mae securitized some $34.9 billion of California single-family mortgages during the first quarter of 2014, down 25.4 percent from the fourth quarter. But the overall agency MBS market fell 27.2 percent over that period. Texas, down 41.4 percent from the first quarter of 2013, and Florida (off 48.7 percent) both had...[Includes one data chart]

Ginnie Mae has held up for several weeks an $8 billion sale of servicing rights from Bank of America to a nonbank because of missing documents on government-backed mortgages. Ted Tozer, president of the agency, confirmed the delay in approvals to Inside FHA Lending, but declined to name the nonbank on the buy-side of the transaction. However, sources familiar with the deal identified the counter-party as PennyMac. BofA and PennyMac would not comment. Once the missing documents are located and placed in the proper files, the deal will move forward, said Tozer. Tozer noted that that in the past the agency did not lose sleep over large MSR transfers because up until three years ago the nation’s megabanks were buyers of MSRs. “We knew they had the financial strength to make the P&I [principal and interest] payments” to the MBS investors, he said. But with nonbank servicers, such as Green Tree, Nationstar Mortgage, Ocwen Financial as well as PennyMac, rapidly growing their portfolios, the agency is ...

Credit officers over the past three months reported an increased demand for non-agency MBS, suggesting that private capital could be flowing more freely through the U.S. housing market, according to a Federal Reserve survey released last week. The Fed’s Senior Credit Officer Opinion Survey on Dealer Financing Terms for March 2014 found little change in the credit terms among the 22 participating institutions, with the exception of securities financing, where nearly one-half of dealers reported a hike in demand for funding non-agency residential MBS. “Dealers assessed...

The equipment-backed ABS sector will likely have another good year this year, and investor interest remains strong, according to a senior analyst at the DBRS credit rating service. “For the equipment finance industry in 2014, we are moderately optimistic,” Chuck Weilamann, senior vice president at DBRS, said during a teleconference last week. “We’ve certainly seen delinquencies and charge-offs hit lows, with a five-year low achieved in 2013.” Not surprisingly, DBRS made...

A continued decline in GSE refinances, in concert with faltering purchase activity midway through the first quarter, helped contribute to an overall drop in the volume of single-family mortgages securitized by Fannie Mae and Freddie Mac in February. Fannie and Freddie issued $44.6 billion in single-family mortgage-backed securities in February, a 5.1 percent decline from January and a steeper 62.0 percent drop for the first two months of 2014 compared to the same period in the previous year.

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 ...

Ginnie Mae is considering lengthening the approval time for transfers of mortgage servicing rights (MSRs) to 90 days or more from the current 30 days but has yet to issue guidance. The agency alerted sellers of MSRs and their investment banking advisors of the forthcoming change in late November at an “education summit” in Washington, according to a participant, who preferred anonymity. New and existing issuers participated in the event, and a copy of Ginnie Mae’s presentation was provided to Inside Mortgage Finance, an affiliated publication. Ginnie Mae declined to comment on the report. However, according to the presentation, the reason for ...