The latest issue of FHA’s Lender Insight provides additional information to lenders regarding the new Loan Review System that was launched on May 15, 2017. FHA urged lenders to keep their contact information current in FHA Connection and in the Lender Electronic Appraisal Portal so that they receive automated system notifications on time. Also, lenders should review current FHAC user access for appropriate roles, the agency added. Lenders’ in-house FHAC application coordinators are authorized to grant access to, and assign roles within, the LRS. Having the correct roles should enable users to access the system from the FHAC menu, the FHA said. In addition, the lender must take a photo of any error messages that might appear on screen before contacting the FHA Resource Center, the agency advised. Be prepared to provide the date and time of the attempted login, user ID, lender user ID and the ...

The MBS and ABS market was a mixed bag in terms of new issuance during the second quarter, as overall production was down slightly from the beginning of the year, according to a new analysis by Inside MBS & ABS. A total of $430.98 billion of single-family MBS, non-mortgage ABS and commercial-property securitizations was issued in the second quarter, down 2.6 percent from the first three months of the year. That pushed year-to-date issuance to $873.47 billion, up 8.1 percent from the first six months of 2016. Single-family MBS accounted for a hefty 75.1 percent of total issuance so far in 2017, with non-mortgage ABS (13.2 percent) and commercial MBS (11.7 percent) making up the rest. But single-family turned...[Includes three data tables]

Near the end of the second quarter, Credit Suisse resumed its activity in the non-agency MBS market after a lengthy pause. In May, the investment bank unveiled a $91.18 million deal backed by seasoned FHA loans. That was followed by a $393.97 million issuance backed by seasoned mortgages at the end of June. Credit Suisse marked its return to the jumbo MBS market in June – not as an issuer but as a depositor – lending its shelf registration to American International Group for a $511.98 million MBS. The bank faced...

Issuance of nonprime mortgage-backed securities skyrocketed in the second quarter, and analysts anticipate that the market is set for more growth. A total of $1.08 billion of MBS backed by newly originated nonprime mortgages was issued in the second quarter of 2017, according to Inside Nonconforming Markets. It was the strongest post-crisis quarter for the sector, which has been percolating since the second half of 2015. Issuance in the April-June cycle ... [Includes one data chart]

Issuance of prime non-agency mortgage-backed securities cooled off somewhat in the second quarter of 2017 after a relatively strong showing in the previous period. Three deals totaling $1.88 billion were issued in the second quarter, a 27.6 percent drop from the first three months of the year, according to Inside Nonconforming Markets. However, activity in the first half of this year outpaced the first half of 2016, as the dollar volume of issuance was ... [Includes one data chart]

A unit of Angel Oak Companies issued its largest nonprime mortgage-backed security this week. The deal comes shortly after a significant amount of mortgages from Angel Oak were included in a separate nonprime MBS from Deephaven Mortgage. The $210.45 million Angel Oak Mortgage Trust I LLC 2017-2 received AAA ratings from DBRS and S&P Global Ratings. Angel Oak has issued three other nonprime MBS, the largest of which was a $150.35 million transaction in 2015 ...

Flagstar Bank recently received assessments by Fitch Ratings of the bank’s origination platform and servicing operations. The ratings could signal increased involvement in the jumbo mortgage-backed security market by Flagstar. Fitch assigned an “average” rating to Flagstar’s origination platform. “Notable strengths of Flagstar’s origination platform include its experienced senior management team and staff, robust loan sourcing strategy, and comprehensive underwriting ...

An analysis of non-qualified mortgages suggests that many of these borrowers have credit qualities strong enough to qualify for a mortgage that could be delivered to the government-sponsored enterprises. However, issues involving credit events and income documentation can disqualify such borrowers from conventional mortgages. According to an analysis by Morningstar Credit Ratings, the weighted-average loan-to-value ratio for securitized non-QMs is 75.2 percent and the average debt-to-income ratio on the loans is 36.6 percent. The rating service noted that QMs (including agency and non-agency mortgages) have an average LTV ratio around 69.0 percent and an average DTI ratio around 32.3 percent. In addition to showing that certain characteristics don’t differ much between QM borrowers and non-QM borrowers, the analysis suggests...

An expert in the commercial real estate debt market is calling on industry participants to “reset the business to where it used to be” to stop the commercial MBS market from shrinking any further. In a recent blog, Rick Jones, partner and co-chair of Dechert’s finance and real estate practice, noted CRE securitization, or at least the conduit part of the business, continues to dwindle. It has fallen from $800 billion in outstanding principal balance in 2007 to approximately $400 billion currently, with a run rate of about $50 billion annually. The downward trend is...

Wells Fargo fell a notch as PennyMac raced to the top to become the leading VA jumbo securitizer for the first quarter of 2017 – a period in which VA jumbo loan securitization took a sharp nose dive. The volume of VA jumbo loans securitized during the first three months plunged 36.8 percent, compared to the meager 2.0 percent decline seen in the fourth quarter. The drop reflected a 32.9 percent drop in jumbo mortgage production during the first quarter, along with similar large drops in virtually every product segment in the mortgage market, according to an analysis by Inside FHA/VA Lending affiliate Inside Mortgage Finance. The agency jumbo market was down 39.1 percent from the fourth quarter despite the bump up in high-cost loan limits to $636,150, an increase of $10,650 that became effective in January. All components of the agency jumbo market took big hits in the first quarter, including ... [ Charts ]