It is unclear how much money is needed to recapitalize RMIC, which is currently in a run-off mode, but Old Republic plans to contribute up to $50 million and raise additional funds in the capital markets to resurrect its MI subsidiaries.

Fitch Ratings released its “initial perspective” this week on how the Consumer Financial Protection Bureau’s ability-to-repay rule and requirements for qualified mortgages will impact ratings for new non-agency MBS. That makes Fitch the first rating service to provide formal insight on how the CFPB rule, which takes effect Jan. 10, will impact jumbo mortgage securitization. Fitch is considering requiring issuers to state the QM status of any mortgage to be included in an MBS, putting a greater emphasis on lender compliance and due diligence, and a focus on representations and warranties for compliance with the ATR rule and QM standards. “The rating approach will likely focus...

A report released this week by analysts at the Federal Reserve Bank of Richmond suggests that real estate investment trusts that invest in agency MBS don’t necessarily pose systemic risks. “While mortgage REITs clearly present risks to investors, it is not yet clear where mortgage REITs fall relative to other financial institutions in terms of their systemic risk,” according to an economic brief from the Richmond Fed. REITs held...

A Manhattan district court judge dismissed a lawsuit against Bank of America in which shareholders accused the bank of hiding a $10 billion fraud case, saying the defendant and several of its top executives were not obliged to reveal the lawsuit in advance to shareholders. Filed in 2011, the shareholders alleged that CEO Brian Moynihan and other BofA executives knew as early as February 2011 that insurer AIG intended to sue BofA in connection with $28 billion of MBS it bought from the bank and its Countrywide and Merrill Lynch acquisitions. According to the shareholders, the bank knew...

The Center for American Progress called on FHFA to keep g-fees at current levels “until there is reliable evidence” to suggest that the government needs more revenue to cover the cost of the guaranty.

It was the now-senior Democrat senator from Massachusetts, Elizabeth Warren, who faulted the Fed for enabling the financial crisis that prompted such an unconventional accommodative response in the first place.

With qualified-mortgage underwriting requirements set to take effect Jan. 10, the rating services are beginning to detail the role QM status will play in ratings for non-agency mortgage-backed securities. Fitch Ratings appears to be the furthest along in adjusting its ratings process to account for the Consumer Financial Protection Bureau’s ability-to-repay rule and QM standards. The rating service this week released its initial perspective for rating non-agency MBS with loans originated in a QM world ...

While many lenders say they intend to stick to originating safe-harbor qualified mortgages, some are taking a long look at the non-QM market or even building their strategy on it. Attorneys speaking at the recent annual convention of the Mortgage Bankers Association said rigorous underwriting, documentation and a solid track-record are prerequisites to competing safely in the non-QM space. And though the challenges are substantial, so are the potential rewards. A number of lenders are likely to test the water ...

One last thought on Berkowitz and Fairholme: To get Congress to listen to your ideas you have to donate money. Berkowitz can check that box off his to-do list. He has been a generous donor to Republicans and Democrats alike over the past two election cycles.

RBS Securities agreed to settle charges levelled by the Securities and Exchange Commission that the underwriter mislead investors in a $2.2 billion subprime mortgage-backed security offered in 2007. “RBS knew or should have known at the time that almost 30 percent of the loans backing the offering deviated so much from the lender’s underwriting guidelines that they should have been kicked out of the offering entirely,” the SEC said of Soundview Home Loan Trust 2007-OPT1. The mortgages in question were ...