Angel Oak Capital Advisors is working on what should turn out to be its second nonprime mortgage securitization of the past six months, a deal that should be similar in size to its first offering of roughly $150 million, Inside MBS & ABS has learned. A source close to the company, who spoke under the condition his name not be used, could not commit to an exact issuance date except to say the security could be issued “soon.” To date, investor interest in the small amount of nonprime/non-qualified mortgage deals that have come to market has been...

Banks generally eased their lending standards for most types of residential mortgage loans in the first quarter of 2016, even as consumer demand for such credit increased, according to the Federal Reserve’s latest senior loan officer opinion survey. During the period ending March 31, a “moderate net fraction” of banks reported having eased standards on mortgages eligible for purchase by the government-sponsored enterprises, Fannie Mae and Freddie Mac, while a similar number of institutions indicated they had eased standards on “qualified mortgage” and non-QM jumbo mortgages, as well as on QM non-jumbo, non-GSE-eligible and on non-QM, non-jumbo residential mortgage loans. At the same time, banks left...

Federal banking regulators have proposed a “net stable funding ratio” for depositories with more than $250 billion in assets that aims to ensure that large banks’ lending and investing activities are sufficiently supported by sources of stable funding over a one-year horizon. The proposed NSFR would require banks to calculate a weighted measure of the stability of their equity and liabilities over a one-year time horizon, known as the available stable funding, or ASF, and calculate their level of required stable funding (RSF) over the same one-year period. Beginning in 2018, the proposed rule would require...

Private shareholder lawsuits against the U.S. Treasury’s net worth sweep of Fannie Mae and Freddie Mac profits are inching forward, including a squabble over the Federal Housing Finance Agency’s bid to consolidate several cases in one court. The Federal Housing Finance Agency said the proposed transfer would prevent future “copycat” cases and ensure a more consistent ruling across the board by having all of the cases heard in one court instead of scattered in different jurisdictions throughout the country. Private plaintiffs, including Tim Pagliara, director of shareholder group Investors Unite, filed...

Although the Consumer Financial Protection Bureau is still months away from officially clarifying certain parts of its complicated integrated disclosure rule known as TRID, the secondary market – and some attorneys – are already breathing a sigh of relief. But the big question remains: how far will the agency go? And will it provide enough clarity to ease the fears of buyers about being sued for monetary errors? The rule, which integrated consumer disclosures under the Truth in Lending Act and Real Estate Settlement Procedures Act, became...

Lenders are getting more comfortable with originating non-qualified mortgages, particularly as opportunities to complete refinances decline. Non-QMs accounted for 14.0 percent of mortgages originated by 159 banks in 2015, up from a 10.0 percent share of originations the previous year, according to a survey by the American Bankers Association. “More banks are adjusting underwriting criteria to target selected non-QM loan opportunities,” the trade group said. The ABA found...

After months of pleading by participants in the non-agency market, Consumer Financial Protection Bureau Director Richard Cordray said the agency will issue formal guidance regarding the TRID mortgage disclosure rule. The announcement last week regarding issues involving requirements under the Truth in Lending Act and the Real Estate Settlement Procedures Act prompted relief and apprehension among industry participants. And help for the non-agency market doesn’t appear to be moving quickly, as Cordray said the effort will start with a notice of proposed rulemaking in late July. Cordray revealed...

Announcements by two real estate investment trusts that are prominent in jumbo lending underscore two key themes in the market: increased competition and the lingering headache caused by the TRID disclosure rule. Redwood Trust recently launched an “expanded prime” program known as “Redwood Choice” for correspondent sellers. “The Choice program is a prime program that is fully documented, but with credit parameters outside our more recent underwriting guidelines,” Redwood said. Choice features...

Ongoing declines in the volume of subprime mortgages outstanding have done little to limit regulatory issues involving subprime servicing. An estimated $287.0 billion in subprime mortgages were outstanding as of the end of the first quarter of 2016, down 16.3 percent from the first quarter of 2015, according to a new ranking and analysis by Inside Nonconforming Markets. The Consumer Financial Protection Bureau released...[Includes one data table]

The costs of ongoing monitoring mandated by various regulators contributed to the large $111.2 million net loss posted by Ocwen Financial in the first quarter of 2016 that included $30.0 million in monitoring costs. Ocwen continues to make progress toward decreasing settlement-related costs though regulatory pressures persist. Ocwen’s monitor costs were...