The Structured Finance Industry Group announced this week that it will convene a taskforce to establish standardized representations and warranties for new non-agency MBS. The “Project RMBS 3.0” effort will involve a wide variety of industry participants in an effort to attract investors to non-agency MBS. If the effort sounds familiar, that’s because the American Securitization Forum issued benchmark reps and warrants in 2009 as part of its Project Restart initiative. “We want to resolve these issues once and for all,” said Eric Kaplan, managing director of Shellpoint Partners and one of the leaders of Project RMBS 3.0, during this week’s ABS Vegas conference sponsored by the SFIG and Information Management Network. He said...

Who at the GSEs (or at the Federal Housing Finance Agency) was responsible for telling Fannie and Freddie to set aside so much money for loan losses and were those assumptions way off base?

The non-agency MBS market is stuck in "limbo until we know where the GSEs are going,” said Steve Abrahams, head of securitization and MBS research at Deutsche Bank Securities.

Hoping to jump start the non-agency MBS market, the Structured Finance Industry Group plans to establish a limited number of options on various rep and warrant issues.

Industry advisors expect Wells Fargo to sell additional packages of mortgage servicing rights in the months ahead.

The lender also recently formed a real estate investment trust, Parkside Mortgage Trust. Matt Ostrander, Parkside’s CEO, said the REIT plans to issue a non-agency MBS later this year or in 2015.

In other words, the White House still wants to dismantle Fannie Mae and Freddie Mac and doesn't seem to care about all the money the two are returning to the government.

It's no secret that banks like to hold jumbo mortgages in portfolio, but depositories are also major contributors to non-agency securities.

Industry analysts predict that the New York ruling will limit rep-and-warrant claims on vintage non-agency MBS as well as future claims on recently issued jumbo MBS.

The statute of limitations for filing representation-and-warranty claims on non-agency MBS starts when a deal is issued, not when a defective loan isn’t cured, according to a recent ruling by the appellate court in New York. Industry analysts suggest that the ruling will limit rep-and-warrant claims on vintage non-agency MBS as well as future claims on recently issued jumbo MBS. In December, the appellate division of New York’s Supreme Court dismissed ACE Securities Corp. v. DB Structured Products. The lawsuit was brought by a trustee on behalf of investors against Deutsche Bank, the issuer of ACE 2006-SL2, a non-agency MBS issued in 2006. The investors, along with HSBC Bank, the trustee, were looking to enforce rep-and-warrant claims in 2012. New York imposes...