The mortgage securitization rate jumped significantly higher during the third quarter of 2016, spurred by a bigger market share for Fannie Mae and Freddie Mac. A total of $416.5 billion of relatively newly-originated mortgages were included in single-family MBS issued during the third quarter, according to a new Inside MBS & ABS analysis. That figure, which excludes modified loans and most mortgages aged more than three months, represented 71.2 percent of the $585.0 billion of first-lien mortgages originated during the period. During the second quarter, the securitization rate was...[Includes one data table]

Fitch Ratings edged out Standard & Poor’s as the most active rating services in the non-mortgage ABS market during the first nine months of 2016, a new Inside MBS & ABS analysis and ranking reveals. Fitch also was the top rating service in the more subdued non-agency MBS market. The company rated some $10.80 billion of non-agency MBS, or 64.8 percent of the total market, which includes a substantial volume of unrated private deals. DBRS (37.2 percent market share) and Moody’s Investors Service (34.5 percent) were...[Includes two data tables]

Social Finance, a nonbank that started offering mortgages in 2014, is preparing to issue a $168.79 million jumbo mortgage-backed security, according to presale reports. It will be the first jumbo MBS from SoFi, which originated all of the mortgages backing the deal. While SoFi started operations in 2011 as a peer-to-peer or marketplace lender, Fitch Ratings noted that its funding strategy has evolved to more traditional sources, such as banks and other large financial institutions ...

A new nonprime MBS from an affiliate of Lone Star Funds has two significant distinctions: it’s the first post-crisis nonprime MBS backed by new originations to receive a AAA rating and it’s the largest post-crisis nonprime MBS backed by new originations. COLT 2016-3 Mortgage Loan Trust received AAA ratings from DBRS and Fitch Ratings. “Over the past year, Fitch has become more comfortable with the operational risk of the issuer through extensive due diligence results, multiple ...

The Structured Finance Industry Group released the fifth edition of its RMBS 3.0 green papers last week, featuring a draft deal-agent agreement and proposed bondholder-communication protocols. The green paper effort to revive the non-agency mortgage-backed securities market started in 2013 and now totals 400 pages. “That’s a lot of work for an industry that apparently doesn’t exist,” Richard Johns, SFIG’s executive director, said last week at the trade group’s annual ...

Proposals aimed at reviving the issuance of non-agency mortgage-backed securities have done little thus far to get volumes anywhere near the levels seen before the financial crisis. Industry participants suggest that there are a number of factors beyond proposed standards from trade groups that are limiting issuance. The American Securitization Forum started its effort to revive the non-agency mortgage-backed security market in 2009. The first post-crisis jumbo MBS backed by newly originated ...

The supply of outstanding single-family MBS grew by 1.0 percent during the third quarter of 2016, with strong demand from several key investor groups soaking up new issuance, according to a new analysis by Inside MBS & ABS. The agency MBS market grew by 1.4 percent from the end of June, reaching $5.948 trillion. Ginnie Mae continued to be the fastest-growing program, with total MBS outstanding climbing 2.2 percent during the third quarter to $1.631 trillion. Fannie Mae saw...[Includes two data tables]

The Structured Finance Industry Group this week put more flesh on the bones of its proposed deal-agent role in future non-agency MBS and introduced a plan for improved communications among MBS investors. The fifth edition of SFIG’s RMBS 3.0 Green Paper adds recommendations on data standardization, enforcement mechanisms for breaches of deal terms and materiality standards. The new proposal on bondholder communications was drafted...

New non-agency MBS issued in 2017 will likely include more diversified collateral and feature some structural changes, analysts at Moody’s Investors Service said in a new report this week. The rating service projected that non-agency prime jumbo volume will remain steady in 2017, while issuers will continue to explore non-traditional asset types, such as re-performing and non-performing loans, reverse mortgages, non-qualified mortgages and nonprime transactions. “Although prime jumbo deals will start to include loans with slightly lower FICOs and higher loan-to-value ratios than those loans included in 2016 transactions, collateral quality will remain...

Standards proposed by the Structured Finance Industry Group for disclosures of representations and warranties on new non-agency mortgage-backed securities are likely to put a burden on conduits and other aggregators that pool mortgages from scores of originators. The Wall Street group recently released the fourth edition of its RMBS 3.0 “green papers,” which aim to revive issuance of non-agency MBS by making reforms that will attract investors. The latest green paper focused on ...