A strong first half of 2015 helped the issuance of jumbo mortgage-backed securities top the volume seen in 2014, according to a new analysis by Inside Nonconforming Markets. But as the year progressed, issuance slowed and industry analysts don’t expect much of an increase in volume in 2016. Some $12.08 billion in jumbo MBS were issued in 2015, up 25.4 percent compared with 2014 but not enough to match the $13.12 billion in 2013 issuance. And jumbo MBS activity ... [Includes one data chart]

Angel Oak Capital Advisors issued a nonprime mortgage-backed security on Dec. 17 tied to loans with an unpaid principal balance of $150.35 million. It was the fourth – and largest – nonprime MBS issued in 2015. Angel Oak Mortgage Trust 2015-1 included a $120.28 million senior tranche, a $15.04 million mezzanine tranche and two subordinate tranches totaling $15.04 million. The deal was issued by Angel Oak’s Greenleaf Income Trust II and was not rated. Officials at Angel Oak said ...

Originations of interest-only mortgages by lenders that are prominent in the niche have lagged behind overall mortgage production trends, according to a new ranking and analysis by Inside Nonconforming Markets. Through the first three quarters of 2015, first-lien IO originations by a group of 12 lenders increased by 13.2 percent compared with the same period in 2014. Overall mortgage production in that time increased by 42.9 percent, according to ... [Includes one data chart]

Some lenders offering non-qualified mortgages see the product as a way to generate volume in a sector of the market that most competitors are avoiding. However, even some prominent non-QM lenders aren’t comfortable originating the loans in New York State. New York was the fourth-ranked state in terms of total originations in 2014, according to an analysis of Home Mortgage Disclosure Act data by Inside Mortgage Trends, an affiliated publication, accounting for 4.2 percent of ...

The government-sponsored enterprises’ risk-sharing transactions more adequately address incentive problems than non-agency mortgage-backed securities, according to a recent report by the Office of Financial Research. The OFR said back-end risk-sharing transactions from Fannie Mae and Freddie Mac “indicate how private housing finance remains crippled.” The OFR is an independent office within the U.S. Treasury Department, focusing on financial stability issues. The GSEs sold ...

Affordable housing advocates are calling for changes to the mortgage interest deduction allowed for federal taxes. Interest on up to $1.0 million in principal is currently deductible. The National Low Income Housing Coalition recently published a report supporting its call for the cap on the mortgage interest deduction to be lowered to loan balances of $500,000 and below. “There is no policy rationale for the federal government to continue to subsidize the portion of mortgages that ...

Risk-retention requirements established by the Dodd-Frank Act for certain non-agency mortgage-backed securities took effect at the end of 2015. Industry analysts suggest that the requirements will have minimal impact on industry participants’ current practices. “Risk-retention rules will not affect overall residential MBS issuance levels because qualified mortgage issuers will be exempt from risk-retention rules, and non-QM issuers already retain risk,” according to analysts at Moody’s Investors Service ...

The omnibus appropriations bill President Obama signed in December included a provision that supporters suggest will help spur reform of the government-sponsored enterprises. The bill prohibits the Treasury Department from selling its senior preferred shares in Fannie Mae and Freddie Mac until at least the start of 2018. “Passage of this provision makes it clear that Congress – which created mortgage giants Fannie Mae and Freddie Mac in the first place – should ... [Includes three briefs]

Originating nonprime mortgages can be done without repeating the mistakes that contributed to the financial crisis, according to officials at Angel Oak Mortgage Solutions. The firm, one of the most prominent lenders in a severely constrained market, launched in early 2014 and offers nonprime mortgages via wholesale and correspondent channels. Tom Hutchens, a senior vice president of sales and marketing at Angel Oak, said the lender is comfortable extending ...

A $56.26 million nonprime mortgage-backed security from Beach Point Capital is scheduled to close next week, according to sources close to the deal. RCO 2015-NQM1 Trust will be backed by mortgages originated by Citadel Loan Servicing, which will also service the loans. The deal will mark the third post-crisis MBS backed by newly originated mortgages, following two MBS from Lone Star Funds’ Colt Funding, including a deal issued last week. Nomura is the placement agent and seller ...