During the next 12 months, investors will have to navigate through numerous uncertainties, including all forms of policy risk: monetary, fiscal, economic and the fate of the GSEs.

While banks have put an emphasis on originating jumbo mortgages for portfolio, the uptick in total mortgages outstanding was largely driven by originations of agency mortgages.

Most of the underlying mortgages have terms of six to nine months, but with a warehouse line in place the terms could range from three to five years.

A few months ago, sources close to the BofA case, said the FHFA was hoping for a settlement in the range of $13 billion.

Ratings on servicer advance asset-backed securities issued by Home Loan Servicing Solutions and Nationstar Mortgage could be downgraded due to a change in rating criteria by Standard & Poor’s that was implemented after the ABS were issued.

Some 44 percent of mods on portfolio loans by eight large banks and thrifts include principal reduction in the third quarter of 2013.

One former regulator told us that HUD is relying too heavily on foreclosure sales, which can drive down median values.

Issuance of jumbo MBS was strong in 2013 until interest rates started to rise in May due to concerns that the Federal Reserve was set to taper its stimulus efforts.

Although the settlement has been filed and agreed to by PNC, it still requires court approval.

While the jumbo MBS market has all but ground to a halt in recent months, industry analysts expect that issuance will resume at some point early next year, but the 2014 forecast is dicey. Some $12.23 billion in jumbo MBS was issued through three quarters in 2013. The market hasn’t seen much activity in the final months of the year due to a lack of demand from investors and continued appetite from bank portfolios. A number of industry analysts expect...