Redwood Trust plans to more than triple the dollar amount of non-agency jumbo mortgage-backed securities it issues this year compared with its issuance from 2012, according to comments this week from officials at the real estate investment trust. Redwood also plans to securitize conforming jumbos and even aggregate conforming loans to sell to Fannie Mae and Freddie Mac. The REIT’s goal for 2013 is to issue about $7.0 billion in non-agency MBS. While potential competitors struggled to ...

JPMorgan Chase is close to selling a non-agency jumbo mortgage-backed security, according to traders and jumbo executives familiar with the company’s activities. Chase is treating the MBS as a test deal – which has been delayed – though it could close by the end of this month. A spokesman for Chase declined to comment on the matter but a source at the company confirmed that a deal is in the works. Chase might issue the deal as a private placement or the company might keep the security for its own portfolio and ...

The ability-to-repay rule from the Consumer Financial Protection Bureau will not have a negative impact on First Republic Bank’s originations of interest-only mortgages, according to James Herbert, chairman and CEO of the bank. Officials at Redwood Trust also said the rule is unlikely to impact its acquisition and securitization of IOs. If anything, First Republic’s Herbert said the new rule from the CFPB, which included harsher treatment for IO originations beginning in 2014, could help increase ...

Firms are looking to issue new non-agency mortgage-backed securities with looser representation and warranty standards than most post-crisis issuance, according to Fitch Ratings. The rating service issued a report this week critical of looser reps and warrants and pointed to Redwood Trust as an issuer with high standards for reps and warrants. “We believe that transactions with these more aggressive rep and warranty provisions have the potential to weaken a transaction and effectively reduce ...

Federal regulators said they are nearly finished writing the final rule on risk retention in non-agency mortgage securitizations, including a revised definition for qualified residential mortgages. Issuance of the rule was delayed until the Consumer Financial Protection Bureau finished its ability-to-repay rule which set standards for qualified mortgages. “QM coming out really now does allow us to finish it,” Federal Reserve Governor Daniel Tarullo said of the risk-retention rule ...

Federal regulators are under pressure from Congress and others to bring more mortgage-related lawsuits, particularly involving “Wall Street banks.” Obama administration officials and former employees of the regulators suggest that more lawsuits are likely, including a focus on non-agency mortgage-backed securities. The latest calls for lawsuits came last week from Sen. Elizabeth Warren, D-MA. At a hearing by the Senate Banking, Housing and Urban Affairs Committee, she questioned how much ...

The Consumer Financial Protection Bureau will closely monitor sales of servicing, particularly to nonbanks, and require new contingency plans from servicers, the agency announced last week. The new scrutiny was prompted by complaints from borrowers as nonbank special servicers have increased their purchases of servicing in recent years. “The CFPB will, in appropriate cases, require servicers engaged in significant servicing transfers to prepare and submit written plans to the CFPB detailing how they will ...

The amount of subprime mortgages outstanding continues to fall, although performance leveled off in 2012 after significant declines in delinquencies beginning in 2010. Some $475.0 billion in subprime mortgages were outstanding at the end of 2012, according to estimates by Inside Nonconforming Markets, down 12.8 percent from the end of 2011. Only two major subprime servicers increased their subprime mortgage holdings in 2012 compared with the end of 2011: Ocwen Financial and ... [Includes one data chart]

The $25 billion national servicing settlement has prompted an increase in principal reduction loan modifications on non-agency mortgages, according to the Treasury Department. However, most of the servicers participating in the settlement have not yet met their principal reduction obligations. Last week, the Treasury said servicers have increased their use of principal reduction outside of the Home Affordable Modification Program’s Principal Reduction Alternative due to the ... [Includes one data chart]

FCI Lender Services ended December with $2.3 billion of private money loans in its servicing portfolio, a 27 percent gain from the same period a year earlier. The nation’s largest private money servicer said it is seeing an increase in contracts and growth in “soft money” loans backed by residential real estate. Gordon Albrecht, chief strategy officer at FCI, said soft money loans currently account for 50 percent of the firm’s business, which is based in Anaheim, CA. “That’s a record for us,” ...