Ginnie Mae has raised the servicing fee compensation for its Home Equity Conversion Mortgage-Backed Securities (HMBS) program. Currently issuers receive either a flat 6-to-75 basis points monthly servicing fee or a 25-75 bps servicing fee based on a portion of the mortgage interest rate. Effective for HMBS with an issue date on or after July 1, 2011, issuers must select a servicing fee margin of at least 36 bps and not exceeding ...

Ocwen Financial Corp. is poised to significantly expand its mortgage servicing business with the acquisition of Litton Loan Servicing from Goldman Sachs Group for approximately $264 million. The sale price does not reflect certain assets that Goldman will retain, the investment bank said in a June 6 statement announcing the deal. The bank did not specify which assets would be excluded from the transaction. The planned sale will end...

Jumbo mortgage originations held up better than the overall market in early 2011, but more of the strength in the sector came from agency programs, according to a new Inside Mortgage Finance ranking and analysis. Mortgage lenders originated an estimated $51.2 billion of new loans that exceeded the bench-mark $417,000 conforming loan limit during the first quarter of 2011. That was down 7.8 percent from the fourth quarter of last year, a much better showing than the 35.0 percent downturn in total mortgage originations during the same period. In fact, loans exceeding $417,000 accounted for...[includes two data charts]

Weichert Financial/Mortgage Access Corp., an agency/jumbo mortgage lender in 43 states, reached a settlement with the banking regulators of 10 states after a multi-state examination found numerous compliance and internal control deficiencies, including the use of an “interstate lending desk” to facilitate the origination or completion of mortgage applications by originators that were not licensed in the appropriate jurisdictions. “The multi-state mortgage examination program was initiated to enhance consumer protection, foster a culture of compliance within the industry, and hold...

The future size and form of the non-agency market continue to be debated even as a number of market participants take significant steps toward reviving issuance of non-agency mortgage-backed securities. One thing is certain: Redwood Trust is no longer alone in its efforts to revive the non-agency market.Goldman Sachs has reportedly acquired more than $1.0 billion in jumbo mortgages via the conduit it established last year. The investment bank is reportedly paying a premium for the loans and plans to issue a non-agency MBS this year. This week, Shellpoint Partners, a specialty finance company, acquired...

Risk-retention rules proposed by federal regulators could limit a popular form of non-prime risk retention, perhaps unintentionally. The treatment of excess spread on non-agency jumbo mortgage-backed securities is also a concern. Tom Deutsch, executive director of the American Securitization Forum, warned that excess spread retained by a deal’s sponsor would not count as risk retention under the qualified residential mortgage proposed rule. In securitizations of non-prime loans, the excess spread typically would be treated as the...

Jumbo mortgages accounted for 7.7 percent of new loan originations in the first quarter of 2011, the highest share for the sector since 2008. A number of correspondent lenders have also expanded their jumbo programs in 2011. Some $25.0 billion in non-agency jumbos were originated in the first quarter of 2011, according to estimates by affiliated publication Inside Mortgage Finance. That was down 16.7 percent from the previous quarter, while overall originations declined by 35.0 percent during the period. The relative strength of the jumbo market increased...[Includes one data chart]

The legacy of toxic subprime and Alt A MBS from Countrywide Financial continued to spread last week, with a California appeals court deciding to allow a class action involving a number of pension funds and other institutional investors against the lender to proceed. The plaintiffs allege that Countrywide and a number of its subsidiaries, officers and U.S. investment banks violated the Securities Act of 1933 by making materially false and misleading statements in over 450 prospectus supplements relating to the issuance of more than $300 billion in subprime and Alt A securities. Specifically, plaintiffs allege the defendants misrepresented the quality of...

Conventional conforming mortgage production took the heaviest hit in new lending during the first quarter as all four corners of the single-family originations market recorded sharp declines, according to a new Inside Mortgage Finance ranking and analysis. Originations of conventional mortgages that meet conforming loan limits sank 40.0 percent from the fourth quarter of 2010, hitting an estimated $213.0 billion. The conventional conforming market still had the biggest role in the market, accounting for 65.5 percent of new originations, but a sharp drop in refinance activity hit the sector hard. Government-insured lending was also... [Includes two data charts]