The Securities and Exchange Commission this week asked for public comment as it begins to reconsider whether mortgage real estate investment trusts and other mortgage-related pools that acquire mortgages and mortgage-related instruments should remain exempt from the requirements of the Investment Company Act. The SEC said it is concerned that some mortgage-related pools, as pooled investment vehicles, may raise...

Banks and thrifts held a record $1.491 trillion of residential MBS in portfolio as of the end of June, according to a new Inside MBS & ABS analysis and ranking of call report data. That was up 1.6 percent from the end of the second quarter and marked the fourth consecutive period of growth in the industry’s MBS holdings. Banks and thrifts owned about 22.8 percent of the estimated $6.535 trillion of MBS outstanding at the end of the second quarter. All the growth came in investments in agency structured finance transactions, mostly REMICs. Bank and thrift holdings of agency REMICs jumped 8.6 percent in the second quarter to $459.9 billion, or 30.8 percent of... [Includes two data charts]

Any modified FHA or VA loan can now be repurchased from a Ginnie Mae MBS if the borrower successfully completes a three-month trial period under a policy shift to align with the FHA version of the Home Affordable Modification Program. Ginnie made the announcement on Aug. 26, effective immediately. Before the policy change, loans had to have missed three full payments before qualifying for a repurchase. Issuers can buy out loans that have remained in pools while borrowers made partial payments for at least three consecutive months under an FHA or VA trial payment plan that is a condition to a permanent modification, Ginnie explained. “Until the loan has been...

Fannie Mae made its second foray of 2011 into the non-agency MBS market by providing a guarantee wrap on a $690.6 billion deal backed by previously modified FHA and VA mortgages. Government Loan Securitization Trust 2011-FV1 is comprised of government loans originated by Wells Fargo and Wachovia. All the loans were previously securitized in non-agency MBS backed by Fannie wraps, including some that date back to 2001. The average age of the loans since modification is 132 months, and 91.2 percent of them are insured by the FHA. According to the prospectus, 19.8 percent of the loans were 30-days delinquent and 35.9 percent were more than...

The Federal Housing Finance Agency this week became among the latest, most influential parties to legally weigh in on the proposed $8.5 billion Bank of America settlement over non-agency mortgage-backed securities.On Aug. 30, the deadline to file objections to the deal, the Finance Agency filed a “Notice of Appearance and Conditional Objection” with the U.S. District Court in Manhattan on behalf of Fannie Mae and Freddie Mac.

The Obama administration is seeking ideas from stakeholders on how to thin out the FHA’s inventory of foreclosed homes, including turning the homes into rental properties to meet the growing need for affordable housing. In addition to addressing the FHA’s real estate-owned, or REO, problem, the Federal Housing Finance Agency, the Department of the Treasury and the Department of Housing and Urban Development are also calling for recommendations for similar home rental programs for REO properties held by Fannie Mae and Freddie Mac. The agencies’ request is aimed at finding the best alternative for “maximizing value to taxpayers and increasing private investment in the housing market, including ...

The Department of Housing and Urban Development has developed a new Web-based tool which allows FHA, Fannie Mae and Freddie Mac to map all foreclosed properties for viewing by potential investors and homebuyers. The new mapping tool displays the location of all foreclosed homes in the agencies’ inventories, which account for nearly half of all real estate-owned or REO properties in the U.S. Communities with high foreclosure rates that are participating in HUD’s Neighborhood Stabilization Program (NSP) will find the REO portal useful in targeting federal funds to acquire, rehabilitate or demolish these REO properties, according to department officials. The map’s consolidated graphic listing enables ...

The consensus among mortgage market watchers is that the downgrade earlier this month of the GSEs by Standard & Poor’s will have no immediate, detrimental impact even as Fitch Ratings this week said it is keeping Fannie Mae and Freddie Mac’s “AAA” rating.Fitch this week also said its outlook for Fannie and Freddie’s ratings remained “stable.” The move was in concert with Fitch’s decision to keep its rating on U.S. debt at the highest grade.“A key element of the explicit support is the guarantee by the U.S. Treasury to inject funds into Fannie Mae and Freddie Mac, so that each firm can avoid being considered technically insolvent by their regulator,” said the rating agency.

The rush to Treasuries that resulted from investor fears about the U.S. and European economies has pushed interest rates closer to the level where a major mortgage refinance wave could start to take shape, but analysts say it’s a good time to load up on agency MBS. “The Fed’s commitment to keep interest rates low until at least mid 2013 strongly improves demand technicals for MBS, in our view,” said analysts at Credit Suisse in a report issued after the Federal Open Market Committee vowed to keep rates at historically low levels for at least two more years. “This provides ...

New York Attorney General Eric Schneiderman blew the whistle on a pending settlement between Bank of America and MBS investors worth $8.5 billion for Countrywide non-agency MBS issued before the financial crisis. Schneiderman last week filed a lawsuit against Bank of New York Mellon – a party to the settlement – for allegedly committing fraud while acting as trustee for MBS trusts securitized by BofA, and asked the court to reject the settlement proposal. “In negotiating the proposed settlement, BNYM labored under a conflict of interest because it stands ...