A planned nonprime mortgage-backed security from an affiliate of Angel Oak Companies received AAA ratings from DBRS and Fitch Ratings. The $146.47 million deal will include credit enhancement of 46.65 percent on the senior tranche. Fitch said the AAA rating for the deal reflects the satisfactory operational review of the contributing lenders conducted by the rating service, 100.0 percent loan-level due diligence review with no material findings, a “Tier 2” representation-and-warranty framework ...

An affiliate of Galton Funding is preparing to issue a jumbo mortgage-backed security with looser underwriting standards than the super-prime deals that have dominated the jumbo market since the financial crisis. DBRS and Moody’s Investors Service assigned AAA ratings to the planned $254.55 million Galton Funding Mortgage Trust 2017-1. The senior tranche of the MBS will include credit enhancement of 13.50 percent, which is much higher than the 5.00 percent credit enhancement ...

Most major jumbo servicers increased their portfolios in 2016, according to a new ranking and analysis by Inside Nonconforming Markets. A group of 30 servicers handled an estimated $921.10 billion in jumbo mortgages as of the end of the year, up 8.7 percent from the end of 2015. Wells Fargo was the top jumbo servicer, with a $279.97 billion portfolio at yearend. While Wells steadily built up its jumbo servicing throughout the year, it lost some ... [Includes one data chart]

The two issuers that recently entered the non-agency mortgage-backed security market included loans originated by lenders that haven’t been significant contributors to nonprime MBS or jumbo MBS. The $145.02 million nonprime MBS from Invictus Capital Partners included mortgages from 21 lenders, led by Calculated Risk Analytics with a 26.1 percent share of the dollar volume of loans in the deal. Calculated Risk Analytics does business as Excelerate Capital, a wholesale lender ...

Potential mortgage borrowers with bad credit or no credit should proceed with caution if they have been offered a subprime mortgage, according to advice from the Consumer Financial Protection Bureau. The CFPB published a blog post this week focusing on the homebuying process for people with “poor” credit scores. The post, part of a series on home purchase advice, was authored by Megan Thibos, a policy analyst with the CFPB’s mortgage markets team. The post suggested that ...

The $356.40 million jumbo mortgage-backed security JPMorgan Chase issued in February 2014 has performed well, according to Kroll Bond Rating Agency. Since issuance, the rating service said JPMorgan Mortgage Trust 2014-1 has experienced minimal delinquencies, no credit-based loan modifications and no losses. As of the end of January, the MBS had an unpaid principal balance of $202.30 million and one mortgage in the deal was 30 days ... [Includes two briefs]

The once dormant market for MBS backed by newly originated nonprime loans is beginning to pick up steam, with deals unveiled by affiliates of Angel Oak Home Loans and Galton Funding. But that’s not all. According to industry officials who work in the sector, Citadel Servicing Corp., Irvine, CA, is planning a rated security for some time in May and there’s even talk that bond investing giant PIMCO might get in on the action. Origination and investment banking sources, speaking under the condition of anonymity, told...

The relatively strong mortgage origination volume late in 2016 propped up production levels in all three major channels, according to a new Inside Mortgage Finance ranking and analysis. Mortgage brokers saw the biggest decline in volume during the fourth quarter, as production slipped 6.7 percent from the previous three-month cycle to an estimated $56.0 billion. But even with the late-year decline, the wholesale-broker market had...[Includes four data tables]

Originations of non-agency jumbo mortgages declined in two consecutive quarters to end 2016, according to a new ranking and analysis by Inside Nonconforming Markets. And while jumbo production was up last year compared with 2016, market share for the sector declined during that time. In recent years, jumbo originations and market share have been on a strong upward trend, though the momentum stalled in the second half of 2016. An estimated ... [Includes one data chart]

The Office of the Comptroller of the Currency’s denial of favorable capital treatment to a non-agency MBS issued by JPMorgan Chase last year could hinder efforts aimed at convincing banks to return to the non-agency MBS market, according to industry analysts. JPMorgan Chase issued two unique non-agency MBS last year with a total unpaid principal balance of $4.53 billion. The so-called portfolio risk-transfer deals accounted for a whopping 48.6 percent of the prime non-agency MBS issued in 2016. Chase packaged...