Commercial banks and thrifts continued to have modest interest in holding non-mortgage ABS during the first quarter of 2017, according to a new Inside MBS & ABS ranking and analysis. The banking industry held $123.43 billion of ABS in its held-to-maturity and available-for-sale investment portfolios at the end of March. That was down 0.3 percent from December. The overall supply of ABS outstanding, excluding collateralized debt obligations, fell...[Includes two data tables]

Citadel Servicing Corp. and Angel Oak Companies – two of the most active nonprime lenders operating today – are looking at record originations for the second quarter and all of 2017. But don’t expect a torrent of conventional lenders to jump into the space anytime soon. According to interviews conducted by Inside Mortgage Finance in recent weeks, there’s plenty of interest in the “new” subprime market, a business predicated on sober loan-to-value ratios and rigorous underwriting, but most conventional lenders do not see it as safe. At least not yet. “Right now, there’s...

Two of the most active nonprime originators operating today may be headed in different directions when it comes to securitizing the non-qualified mortgages they’ve been originating. An official at the Angel Oak Companies told Inside MBS & ABS this week that the lender hopes to securitize at least once a quarter “going forward.” Citadel Servicing Corp., Irvine, CA, had hoped to issue its first security either late this month or in June, but appears to be pushing back its timetable. Dan Perl, CEO and founder of Citadel, declined...

Wells Fargo is planning to issue non-agency mortgage-backed securities backed by new originations this year, according to an official at the bank. The company was one of the top issuers of non-agency MBS before the financial crisis, but like most big banks, Wells has opted to retain its jumbo production in portfolio. “This year, one of our aspirations is to come back to the market with a couple of deals,” said Franklin Codel, senior executive vice president of consumer lending ...

Large servicers of jumbo mortgages continued to increase their holdings in the first quarter of 2017, according to a new ranking and analysis by Inside Nonconforming Markets. And delinquency performance improved on already low levels. The unpaid principal balance of jumbo mortgages serviced by a group of 30 companies hit $935.70 billion at the end of the first quarter of 2017, up 1.6 percent from the previous quarter and up 8.4 percent ... [Includes one data chart]

JPMorgan Chase is preparing to issue a $1.02 billion non-agency mortgage-backed security with jumbo mortgages along with loans eligible for sale to the government-sponsored enterprises. JPMorgan Mortgage Trust 2017-2 received preliminary AAA ratings last week from Kroll Bond Rating Agency and Moody’s Investors Service. The deal will be the second-largest non-agency MBS backed by post-crisis originations, topped only by the $1.03 billion security Chase issued in ...

Five Oaks Investment shut down its jumbo conduit operations but is still involved in the sector by providing a backstop to representations and warranties on jumbos originated by other lenders. The real estate investment trust is backstopping reps and warrants for mortgages sold on a loan exchange operated by MAXEX. “In July 2016, the company announced that it would no longer aggregate and securitize residential mortgage loans; however, given Five Oaks Acquisition ...

Data regarding subprime mortgages outstanding, delinquencies and loss mitigation activity are getting more difficult to track as the market has essentially been in runoff mode since 2009.Few servicers report on their subprime portfolios, a key delinquency data series was recently discontinued and details on loan modifications are lagging. Some $247.0 billion of subprime mortgages were outstanding as of the end of the first quarter of 2017 ... [Includes one data chart]

Credit Suisse is preparing to issue a $91.18 million non-agency mortgage-backed security backed by seasoned FHA mortgages, according to a presale report by Moody’s Investors Service. CSMC Trust, Series 2017-FHA1 received a preliminary A1 rating. Credit Suisse was a major issuer of post-crisis jumbo MBS but hasn’t issued a jumbo MBS since the fourth quarter of 2015. Fitch Ratings completed a review this week of 63 non-agency MBS backed by post-crisis originations ...

An uptick in mortgage interest rates has reduced rate-term refinance volume but demand from borrowers for cash-out refis and home-equity loans appears to remain relatively strong. “When we look at the landscape for home-equity extraction, we see potential tailwinds from loan-to-value ratio and credit curing combined with slightly less stringent lending standards helping bolster borrower demand,” analysts at Wells Fargo Securities said in a report last week. Borrower LTV ratios have been helped...