loanDepot’s initial public offering of stock – $100 million is the target capital raise – is viewed as a bullish sign for the mortgage industry, especially nonbanks, but don’t expect a long line of imitators, at least not yet. Advisor Joe Garrett, who runs Garrett, McAuley & Co., isn’t quite sure what to make of the recent IPO news, stating bluntly: “I’m sure it will get a lot of ‘wannabes’ hot and bothered.” Garrett noted...

Private investors in Fannie Mae and Freddie Mac stock are raising concerns about the expansion of risk-transfer activity at the two government-sponsored enterprises, warning that it should not be viewed as the answer to housing reform. The credit-risk transfer programs are often cited as a path to housing finance reform because they bring new private capital to the mortgage business, laying off some of the risk held by the GSEs and, ultimately, by taxpayers. “Some have suggested...

Over the past two years, roughly $13 billion in securities backed by single-family rental properties have come to market, a good start for a business that barely existed five years ago. But despite that growth, there are concerns that the “easy money” could be behind the sector. Some of that concern stems from the flood of entrants into the single-family rental market – a boom that turned red hot in 2012 and 2013 when it was first revealed that institutional investors such as The Blackstone Group and others were buying thousands of properties in once decimated housing markets with an eye toward renting them out. When investors began issuing securities backed by the rent rolls, even more money began pouring...

Recent disappointing job creation numbers and continued concern about slowing economic activity around the globe have convinced an increasing number of Wall Street analysts, participants and observers that the Federal Reserve’s Open Market Committee will not raise interest rates at its next meeting, scheduled for later this month. Further, more market professionals don’t predict an uptick in rates until sometime in 2016. And a few are even speculating a liftoff won’t come until the year after that. According to Peter Schiff, CEO and chief global strategist for investment firm Euro Pacific Capital, “the downright dismal September jobs report that was released last Friday may prove...

Over the past few months, the chief executive officers at two publicly traded mortgage firms and a private cooperative have departed, creating uncertainty in the market while underscoring what might seem obvious to some: It’s not easy running a mortgage business these days. CEOs heading for the exits – either on their own accord or via a management edict – include Jim Cutillo of Stonegate, Jeff McGuiness at the Lenders One Cooperative, and most recently Mark O’Brien, who headed nonbank lender/servicer Walter Investment Management Corp. And rounding out the “departure club” is...

An acquirer of mortgage servicing rights has agreed to pay $1.5 million and to stop committing further violations to resolve charges of misstating net income and misleading the Securities and Exchange Commission about its relationship with servicer Ocwen Financial Group. The settlement agreement between the SEC and Home Loan Servicing Solutions is the latest twist in the long-running federal and state investigations of Ocwen and its relationships with affiliated companies, which have included HLSS, Altisource Residential, Altisource Portfolio Solutions and Altisource Asset Management. The common thread in all five companies is...

While there may be some dispute in the industry regarding front-end versus back-end transactions, it’s clear that Fannie Mae and Freddie Mac credit-risk transfer programs are here to stay and will only intensify, according to Bob Ryan, the Federal Housing Finance Agency’s acting deputy director of the division of conservatorship. “The FHFA and the enterprises are committed to credit risk on a routine basis. It is not a pilot; it’s a routine part of our ongoing activity,” he said during a Bipartisan Policy Center seminar on mortgage finance reform. Ryan re-emphasized...

Fannie Mae and Freddie Mac continued to tap investor interest in credit-risk transfer transactions over the last week or so, with each company announcing another deal involving more support from various elements in the insurance and reinsurance sectors. Last week, Fannie announced it has completed its latest Credit Insurance Risk Transfer transaction, which shifts credit risk on a pool of loans to a panel of reinsurers. In CIRT-2015-3 which became effective Aug. 1, 2015, Fannie retained...[Includes one data table]

The much-anticipated $150 million nonprime MBS deal from Angel Oak Mortgage Solutions appears to have hit a brick wall with concerns arising over representations and warranties on the transaction, according to one high-level source who claims to have knowledge of the deal. Both Angel Oak and the underwriter, Nomura Securities, this week once again did not return several media inquiries on what might have gone wrong. Originally, the bond – a privately issued transaction – was slated for sale to investors sometime in September but never came off. The source, who spoke to Inside MBS & ABS under the condition his name not be used, said...

A memo issued by the Internal Revenue Service this year regarding the tax treatment for certain real estate mortgage investment conduits has been a boon for investors in nonperforming loans, according to William Cejudo, a partner at the law firm of Clifford Chance. At the recent ABS East conference sponsored by Information Management Network in Miami, Cejudo provided some background on Technical Advice Memorandum 2015-17007, which was issued by the IRS in May. The memo covered a life insurance company’s formation of a REMIC that held impaired non-agency MBS. “It’s...