Ginnie Mae issuance of government-insured mortgage-backed securities rose a whopping 47.3 percent in the second quarter of 2015 from the previous quarter, powered by a robust FHA refinancing volume, according to an Inside FHA/VA Lending analysis of agency data. Government-backed Ginnie MBS production in the second quarter totaled $117.5 billion, up from $79.8 billion in the prior quarter. Volume year-to-date also increased by 57.7 percent from the first six months of last year. From May to June, government-backed securitization increased a modest 2.9 percent. FHA loans comprised 62.6 percent of Ginnie MBS issuance in the second quarter while VA accounted for 33.7 percent. Securitized loans with a Rural Housing Service guaranty represented 3.6 percent of total Ginnie MBS issuance during the period. FHA loan securitization was robust in the second quarter, as volume ... [ Charts ]

Overview Conference Call for Mortgagees, Servicers and Other Interested Parties. The FHA will host an industry briefing session on July 16, 2015, 2 p.m.-3 p.m., to provide an overview of the Servicing and Loss Mitigation Section of the Single-Family Policy Handbook, as outlined in the Highlights of Changes and Clarifications document. The conference call’s dial-in number is (800) 700-7784. The participant access code is 364218. USDA Performs System Maintenance. The U.S. Department of Agriculture’s mortgage guaranty system will not be functioning at full capacity from July 10-13 due to routine maintenance. Maintenance work is scheduled to begin at 2 p.m., July 10, CDT. The Guaranteed Underwriting System will be operating at a reduced level. Lenders will not be able to make final submissions or upload documents for the entire work period. In addition, the ...

Home prices remain below their peak levels and mortgage interest rates are well below where they were prior to the financial crisis. However, mortgage originations since 2008 have been significantly below the levels seen in years prior as tight underwriting standards have limited production. “Home prices are still very affordable by historical standards, despite increases over the last three years,” the Urban Institute’s Housing Finance Policy Center noted in a recent report. “Even if interest rates rose to 6.00 percent, affordability would be at the long term historical average.” Black Knight Financial Services added...

After just over a year of buying mortgages that don’t meet the qualified-mortgage test, Jeff Lemieux has departed Bayview Asset Management while signaling that a non-QM securitization likely won’t happen any time soon – or even this year. Lemieux, who headed correspondent purchases for Bayview, provided Inside MBS & ABS with a blunt assessment of both non-QM originations and securitizations: “Nothing’s happening.” Lemieux went...

While the characteristics of loans included in jumbo mortgage-backed securities continue to be strong overall, industry analysts note that there are significant differences in “soft” underwriting guidelines used by lenders. “Not all underwriting guidelines, and exceptions to guidelines, are created equal,” analysts at Morningstar Credit Ratings cautioned in a recent report. “Some originators recently have introduced programs that make qualifying for financing easier and require less income documentation.” The company, which is making a new push to rate jumbo MBS, reviewed the guidelines of a number of the most active jumbo originators and aggregators ...

A recent ruling by the New York Court of Appeals regarding the statute of limitations for representation-and-warranty claims on non-agency mortgage-backed securities has caused concerns for some participants in the new-issue jumbo MBS market. In ACE Securities v. DB Structured Products, the court ruled that the statute of limitations for claims of breaches of reps and warrants starts when a deal is closed, not when a potential breach is discovered. Lawyers involved in non-agency MBS were divided on how the ruling would impact issuance going forward ...

Downgrades by Standard & Poor’s to numerous servicer ratings for Ocwen Financial could have a significant impact on the nonbank’s servicing operations. The rating service downgraded servicer ratings for Ocwen to “below average” last week, citing continued scrutiny by investors and regulators along with concerns about internal audits at Ocwen. As of the end of the first quarter of 2015, approximately 700 of the 4,100 non-agency servicing agreements handled by Ocwen had criteria regarding minimum servicer ratings ...

The amount of home-equity loans held by banks and thrifts as of the end of the first quarter of 2015 declined slightly compared with the end of 2014, according to the Inside Mortgage Finance Bank Mortgage Database. Banks and thrifts held a combined $974.0 billion in home-equity lines of credit, unused HELOC commitments and closed-end second liens at the end of the first quarter, down 0.9 percent from the previous quarter. Closed-end seconds accounted for 7.5 percent of the holdings, with the remaining balance divided fairly evenly between HELOCs and unused HELOC commitments ... [Includes one data table.]

A new feature Redwood Trust has included in its two most recent jumbo mortgage-backed securities has prompted support from AAA investors along with mixed reactions from rating services. The $356.45 million Sequoia Mortgage Trust 2015-2 issued in April and the $343.21 million Sequoia Mortgage Trust 2015-3 that was issued this week included a unique stop-advance feature. Servicers of the loans won’t be allowed to provide advances of principal and interest on loans that are 120+ days delinquent. The jumbo MBS were rated by Kroll Bond Rating Agency and Moody’s Investors Service ...

With issuance of non-agency mortgage-backed securities unable to keep pace with disappearing volume from vintage deals, bank and thrift holdings of non-agency MBS continue to decline. The holdings were down somewhat more than usual in the first quarter of 2015, suggesting sales by some banks. Banks and thrifts held $111.48 billion in non-agency MBS as of the end of the first quarter of 2015, according to the Inside Mortgage Finance Bank Mortgage Database. The holdings declined by 16.1 percent compared with the first quarter of 2014, including an 11.0 percent decline compared with the fourth quarter of 2014 ... [Includes one data table.]