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 ...

A continued decline in GSE refinance activity helped contribute to an overall dip in the volume of single-family mortgages securitized by Fannie Mae and Freddie Mac in November, according to a new Inside The GSEs analysis. Fannie and Freddie issued $58.7 billion in single-family mortgage-backed securities in November, a 13.4 percent decline from October and a 6.2 percent decrease for the first 11 months of 2013.

A Manhattan federal court this week approved a proposed settlement between Residential Capital and the Federal Housing Finance Agency that both clears the way for the former conduit to exit bankruptcy and brings the FHFA one step closer to completing its massive legal action against some of the nation’s top financial institutions.Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York approved the agreement, which is tied to a settlement the FHFA reached with Ally Financial, ResCap’s former parent, in late October.

Mortgages originated by brokers and correspondents, once a concern for MBS investors, have actually performed better in recent years than retail-originated loans, according to Moody’s Investors Service. The rating service said risks from third-party originations will remain low if lenders continue to put an emphasis on retail-originated mortgages. Default rates on securitized mortgages have decreased significantly in recent years regardless of origination channel. However, Moody’s noted that beginning in 2010, production from third-party originators started performing better than retail mortgages. From 2003 through 2009, third-party originations defaulted...

A reformed housing finance system should first and foremost put the risk and rewards of mortgage lending in the hands of “private actors,” with the government playing a key role to reduce the impact of the inevitable financial-market failures, “especially when their failures are exacerbated in a cyclical downturn,” an Obama administration official noted this week. Speaking at an Urban Institute event, James Stock, a member of the Council of Economic Advisers, outlined the administration’s central theme of “cyclical resilience” or the need for the mortgage finance system to provide liquidity at “reasonable rates” during both good and bad times. “A cyclically resilient housing finance system provides...