The Trump administration is likely to play a more active role in reducing the footprint of the government-sponsored enterprises in 2019, according to administration officials and industry analysts. Mel Watt’s term as director of the Federal Housing Finance Agency is set to end in January, allowing Trump to appoint a new director. The new director will likely take actions that are aligned with the Treasury Department’s goals for Fannie Mae and Freddie Mac, according to industry analysts ...

Prepayment rates on non-qualified mortgages are higher than the rates seen on legacy non-agency mortgages and performance for new production is better, according to industry analysts. “Nonprime non-QM loans have exhibited high voluntary prepayment speeds, resulting from credit curing and high initial mortgage interest rates,” analysts at Deutsche Bank Securities said. The voluntary prepayment rate on non-QM mortgage-backed securities ... [Includes one data chart]

TIAA and Angel Oak Companies look likely to price separate new MBS before the end of the second quarter, according to documents filed with the Securities and Exchange Commission. JPMorgan Chase is also preparing an MBS that could differ from its typical issuance. Merrill Lynch agreed to a settlement with the Securities and Exchange Commission this week regarding non-agency mortgage-backed security trading from 2009 through 2012 ... [Includes two briefs]

Originations of jumbo mortgages declined across channels in the first quarter with the retail channel gaining market share, according to survey results analyzed by Inside Nonconforming Markets. Jumbo originations reported by survey respondents declined by 30.4 percent from the fourth quarter of 2017 to the first quarter of this year. The survey data, gathered by Inside Mortgage Finance, included $40.4 billion of first-quarter jumbo originations, roughly two thirds ... [Includes one data chart]

Whole-loan trading is an increasingly important profitability tool for lenders in a market where soft production volume is squeezing margins, said industry officials during a panel session at the recent secondary market conference sponsored by the Mortgage Bankers Association. Loans tailored for Community Reinvestment Act needs, nonprime mortgages and arbitrage opportunities in agency loan-level pricing are hot products in the whole-loan market, officials said. Mason-McDuffie Mortgage ...

The purchase-mortgage share of jumbo originations increased in 2017 on an annual basis, according to an Inside Nonconforming Markets analysis of data from the Home Mortgage Disclosure Act. The loans accounted for 63.6 percent of the $317.29 billion of jumbos originated in 2017, up from a 53.5 percent share the previous year. The emphasis on purchase mortgages varied among the top jumbo lenders. Purchase loans accounted for 69.4 percent ... [Includes three data charts]

Ellington Financial wants to speed up its issuance of non-agency mortgage-backed securities but competition for non-qualified mortgages is getting in the way. Ellington issued its first MBS backed by non-QMs in November. All of the mortgages in the $141.2 million deal were originated by LendSure. Ellington has an equity investment in the lender. Laurence Penn, president and CEO of Ellington, said the firm is preparing to issue another non-agency MBS and the nonbank would prefer to ...

More small banks can soon receive qualified-mortgage status for certain originations even if the loans would otherwise be non-QMs thanks to provisions in the Dodd-Frank reform legislation signed into law last week. The new type of QM will be available to banks and credit unions with less than $10.0 billion in total assets. Originations held in portfolio by such institutions will receive QM status if they meet a variety of standards. The exemption is already provided to depositories with ...

Issuers of non-agency mortgage-backed securities continued to bring a variety of deals in May. JPMorgan Chase and Redwood Trust are set to issue separate prime non-agency MBS and nonprime MBS is on the way from Deephaven Mortgage and Lone Star Funds. Both Chase and Redwood continue to include mortgages eligible for sale to the government-sponsored enterprises in their issuance. Such loans will account for essentially half of the $650.5 million issuance ...

Mortgages for self-employed borrowers look to be an area of growth for non-agency lenders. Embrace Home Loans and Truss Financial Group introduced separate products for self-employed borrowers recently. Embrace said its “beyond” products will provide finance to borrowers that other lenders have denied. “Beyond is our program that offers financing solutions for borrowers who don’t easily fit into the guidelines for conventional mortgages,” the lender said. “They call it ...