Japanese investors increased their holdings of agency MBS by $32 billion and even boosted their non-agency MBS investments by $1.4 billion.

Although the recent spike in rates spooked some players in the non-agency market, conduits like Redwood Trust and Credit Suisse are still in the hunt for new customers.

Gordon Albrecht, executive vice president for FCI Lender Services, said, “The less the banks lend, for whatever reason, the more goes to private-money firms.”

Spreads have widened significantly on non-agency jumbo MBS in recent weeks, cutting into issuers’ profits.

The Consumer Financial Protection Bureau this weekend proposed limited revisions and clarifications to a number of its mortgage rules. The CFPB proposed allowing originations of certain high-cost balloon mortgages by small lenders to receive qualified mortgage status regardless of where the lenders operate. The CFPB also proposed slightly tweaking an exemption from escrow requirements on certain higher-priced mortgages originated by lenders in rural and underserved areas. To prevent ... [Includes two briefs]

An FHA proposal for new legislative authority to transfer servicing has raised concerns among industry participants, particularly in the Ginnie Mae market. Authorizing the FHA to shift mortgage-servicing rights from one servicer to another could have a ripple effect on Ginnie Mae servicing rights and also adversely impact state mortgage servicing and origination licenses, some say. The bottom line is that Congress should consider FHA’s request for new statutory authority with great care, said Larry Platt, a compliance attorney and a partner at the Washington law firm K&L Gates. “We would hope that ...

Reverse mortgage lenders, consumer groups and certain advocates for the elderly are urging Congress to enact legislation passed recently by the House of Representatives granting the FHA additional authority to govern its reverse mortgage program. Testifying before the Senate Banking Subcommittee on Housing, Transportation and Community Development, the groups said the most productive action Congress can take is to pass H.R. 2167 to allow HUD to make expeditious changes to the Home Equity Conversion Mortgage program through mortgagee letters. The bill, which the House approved on June 12, would ...

Deep-freezing the Home Equity Conversion Mortgage program’s full-draw, fixed-rate standard product apparently has not diminished borrowers’ appetite for reverse mortgages as indicated by a significant increase in HECM originations in the first quarter of 2013. FHA endorsements under the HECM program surged 36.2 percent during the first three months of 2013, with lenders reporting $3.84 billion at the end of the quarter, according to Inside FHA Lending’s analysis of FHA data. Volume was also up a modest 5.3 percent from the same period a year ago. The Department of Housing and Urban Development announced the ... [1 chart]

During an Inside Mortgage Finance webinar on Thursday, participants from expressed frustration on the ability to get new jumbo MBS deals because of the recent rapid rise in rates.

Assured Guaranty Municipal Corp. will terminate a lawsuit it has pending against Flagstar Bancorp and will not pursue any future related claims under a settlement agreement the two entities announced last week. Under the agreement’s terms, Flagstar will pay Assured $105 million to settle the suit filed by the Bermuda-based bond insurer in 2011 related to $902 million of non-agency MBS it insured in 2005 and 2006 that were backed by home-equity lines of credit. The suit claimed the HELOCs did not comply with the representations and warranties made by the bank. In February, a New York federal judge ruled...