The massive shakeout in the warehouse financing industry that began in 2007 has left the door wide open for community banks and mid-sized regional financial institutions to enter and become essential providers of warehouse lending. Among the recent new entrants is EverBank Financial Corp., of Jacksonville, which last month signed an agreement to acquire MetLife’s warehouse finance business, boosting its potential to be one of the major players in the resurging sector. Terms and conditions of the acquisition agreement remain undisclosed and the deal is expected to be completed by the first half of 2012...

The mortgage servicer American Home Mortgage Servicing Inc. recently announced a name change to Homeward Residential, reflecting its entrance into the correspondent and warehouse lending market in October 2011. AHMS ranked 18th on a list of top mortgage servicers in 2011 compiled by affiliated publication Inside Mortgage Finance. The company serviced $69.02 billion in residential mortgages at the end of 2011, down 9.7 percent from the year before, with most of its business in non-agency mortgages. The company plans to complete its rebranding as Homeward Residential by the second quarter of 2012. The business...

The Obama administration has released its February Housing Scorecard, and news regarding the housing overhang is largely positive. Existing home sales have continued their upward climb, reaching the highest they’ve been since May 2010. According to the scorecard, if turnover continued at the current rate, it would take 6.1 months to sell the supply of existing homes on the market, and another 5.6 months for the stock of new homes for sale. Timelines haven’t been that short since 2006. There is always a “but,” however. This month, it’s home prices, which continue to fall despite positive market news. Outstanding...

Bank of America and JPMorgan Chase will once again receive servicer incentives for modifying loans after more than seven months during which these payments were withheld by the Treasury Department for unsatisfactory performance in the Home Affordable Modification Program. The two banks will also get all the withheld incentives as part of the multistate foreclosure settlement. In June 2011, Bank of America, JPMorgan and Wells Fargo were all called to the carpet by the Treasury for their HAMP performance following a 10-month audit of participating servicers. The main issue was timeliness – while mods...

Mortgage lenders have become so risk-averse and sensitive to potentially punitive judicial or regulatory overkill that they’re demanding near-pristine credit histories and imposing their own credit overlays on top of existing underwriting standards that are already considerably tougher than they were during the years of the mortgage boom. And that’s unlikely to change and may in fact get worse unless federal policymakers make dramatic changes to the legislative and regulatory landscape. That was the main take-away that Paul Miller, managing director and group head of financial services research at...

MBS investors continue to sweat over the impact of the $25 billion multistate servicing settlement, especially regarding potential conflicts of interest when banks own a second mortgage while servicing a securitized first lien. “The minimum requirement is that every time you modify a first lien, you have to modify the second lien to the same degree, or you have to write off the second lien entirely,” explained Shaun Donovan, secretary of Housing and Urban Development, at a housing conference earlier this week. Donovan characterized the treatment of home-equity loans in the settlement as a positive...

There are additional signs of emerging investor interest – and perhaps more importantly, actual capital – for plowing into mortgage-related bonds, residential and commercial alike. Earlier this week, the Federal Reserve Bank of New York used a competitive process to sell off the remaining $6.0 billion of securities in the Maiden Lane II portfolio to Credit Suisse Securities. The New York Fed said the move will result in full repayment of the $19.5 billion loan it extended to ML II and generate a net gain for the U.S. taxpayer of about $2.8 billion, including $580 million in accrued interest on the loan...

Bank of America won a favorable ruling this week on its proposed $8.5 billion settlement with a group of non-agency mortgage-backed securities investors. With the settlement likely to be decided in state court, analysts suggest that the deal will serve as a model for other non-agency MBS disputes. Baupost Group, a distressed debt fund that has challenged the settlement under the name “Walnut Place,” succeeded in October in having the settlement moved to federal court. However, the Second Circuit Court of Appeals determined this week that the settlement should be overseen by the Manhattan State Supreme Court ...

Bank of America had already been dialing back its mortgage deliveries to Fannie Mae, along with declining overall production volume, before the company unexpectedly announced last week it has stopped sales to the government-sponsored enterprise altogether. But according to reports, a top Fannie official said the GSE acted first to end the relationship in frustrations with the bank’s delays in resolving repurchase issues. BofA said disputes over repurchases were one factor leading the bank to stop selling most single-family mortgages to Fannie, although the company also cited an inability to renegotiate...

Most securitizers in the non-agency MBS market have filed relatively few repurchase demands with loan originators, and only a small portion of these demands resulted in a buyback. A new Inside MBS & ABS analysis of representations and warranties disclosures now required by the Securities and Exchange Commission revealed that non-agency MBS securitizers sought just $7.45 billion in repurchases over the three years ending in 2011. That represented just 1.1 percent of the total issuance reported by securitizers. The new reps and warranties disclosures – which were mandated by the...(Includes one data chart)