Investors in non-agency MBS continue to push for increased transparency on both vintage securities and new issuance. Issuers suggest that they want to provide additional information to investors but costs and regulatory issues have prevented adequate communication. A significant number of investors attending the ABS Vegas conference last week said bondholder communication on non-agency MBS is rarely adequate. The conference was sponsored by the Structured Finance Industry Group and Information Management Network. Bill Moliski, a managing director at SG Capital, an investment management firm, has...

Issuance of non-agency mortgage-backed securities is expected to remain constrained until a number of issues are sorted out, from reform of the government-sponsored enterprises to an increase in demand from investors. “The non-agency MBS market is stuck somewhat in limbo until we know where the GSEs are going,” said Steven Abrahams, head of securitization and MBS research in the U.S. at Deutsche Bank Securities, during last week’s ABS Vegas conference. More than 5,600 people registered ...

The Treasury Department and the Structured Finance Industry Group announced separate initiatives last week aimed at increasing activity in the non-agency market. Both efforts plan to round up a variety of industry participants to work through issues that have prevented significant issuance of new non-agency mortgage-backed securities. “In the absence of an apparent leader, Treasury plans to coordinate a series of conversations with relevant regulators, market participants and other stakeholders to help ...

Mortgages included in new non-agency mortgage-backed securities that fall outside of the safe harbor for qualified mortgages will be assigned higher loss expectations, according to criteria released last week by Standard & Poor’s. Other rating services have released similar criteria, with credit-enhancement requirements expected to be higher for non-agency MBS that include loans other than safe harbor QMs. The Consumer Financial Protection Bureau’s ability-to-repay rule established a number of ...

Borrowers looking to purchase a home with a loan balance above conforming loan limits have a number of financing options, according to real estate agents across the country. However, some potential homebuyers are opting to avoid jumbo mortgages by paying with cash or putting enough down to receive a conforming mortgage. Tom Popik, research director of Campbell Surveys, said respondents to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey reported that jumbo mortgage availability ...

Cove Financial is targeting borrowers who can’t qualify for agency mortgages and offering them a unique rent-to-own option. The lender’s Mortgage Alternative Program involves a process that looks a lot like the purchase-mortgage process but instead gives a borrower time to rebuild credit before purchasing a home. “It’s for people who have a downpayment but don’t currently qualify for a mortgage,” Patrick Flanagan, CEO of Cove Financial, said of the MAP. A borrower working with Cove goes through a ...

Spurred by low interest rates and strong house price appreciation, Home Equity Conversion Mortgage loan originations rose 20.3 percent during the first nine months of 2013 compared to the same period the year before, according to Inside FHA Lending’s analysis of FHA snapshot data. HECM lenders reported $11.8 billion in total originations over the nine-month period, with initial principal amount at loan origination totaling $7.8 billion. Purchase reverse mortgage loans comprised 94.5 percent while fixed-rate mortgages accounted for ... [1 chart]

The Senate this week passed bipartisan legislation that would delay unforeseen, excessive flood-insurance premium hikes for FHA and conventional mortgages nationwide. S. 1926, the Homeowner Flood Insurance Affordability Act, passed by a vote of 67 to 32, as amended. Introduced by Sens. Robert Menendez, D-NJ, and Johnny Isakson, R-GA, the bill would delay rate increases for up to four years by giving the Federal Emergency Management Agency time to study the problem and develop a plan to help homeowners who cannot afford higher premiums. The increases were mandated by the Biggert-Waters Flood Insurance Reform Act, which Congress ...

Ginnie Mae is considering lengthening the approval time for transfers of mortgage servicing rights (MSRs) to 90 days or more from the current 30 days but has yet to issue guidance. The agency alerted sellers of MSRs and their investment banking advisors of the forthcoming change in late November at an “education summit” in Washington, according to a participant, who preferred anonymity. New and existing issuers participated in the event, and a copy of Ginnie Mae’s presentation was provided to Inside Mortgage Finance, an affiliated publication. Ginnie Mae declined to comment on the report. However, according to the presentation, the reason for ...

VA Lenders’ Compliance with CFPB’s Ability-to-Repay and Qualified Mortgage Rules. Until the Department of Veterans Affairs’ rule on ATR/QM is in place, all VA lenders must comply with the requirements of the Truth in Lending Act, as established by the Consumer Financial Protection Bureau’s ATR/QM rule, according to a recent agency guideline. VA will continue to guarantee all loans made in compliance with existing VA requirements, regardless of their QM status, the agency clarified. It urged lenders to refer to the CFPB guidance to ensure all their VA loans are ...