Ocwen Financial posted record revenues in the third quarter of 2013 that could have been even higher if not for unexpected delays in boarding $42.0 billion in unpaid principal balance on non-agency mortgages from OneWest Bank. Officials at Ocwen wouldn’t reveal the exact cause of the delay. The loans were in non-agency mortgage-backed securities issued by IndyMac, which was taken over by the Federal Deposit Insurance Corp. in 2008 and sold by the FDIC to OneWest in 2009. Ocwen officials said delays ...
It was pretty much stimulus as usual at the Federal Open Market Committee this week, as the Fed showed not the slightest indication of when it would begin winding down the third phase of its quantitative easing program, known informally as QE3 when it was first unveiled, but increasingly referred to as QE Infinity by those who emphasize its long, drawn-out nature. The status quo results mean the Fed will continue adding to its agency MBS portfolio at a pace of $40 billion per month and longer-term Treasury securities at a pace of $45 billion per month, and keep plowing its principal payments from its agency debt and MBS holdings back into agency MBS and rolling over maturing Treasury securities at auction. Among those voting in favor of keeping the Fed’s pedal to the metal were...
As leaders of the Senate Banking, Housing and Urban Affairs Committee continue their slow but steady efforts to craft a comprehensive, bipartisan mortgage finance reform bill, experts generally agreed on the necessity for some sort of government backstop for MBS but differed on the details. This week’s hearing was the first of several planned by Committee Chairman Tim Johnson, D-SD, and Ranking Member Mike Crapo, R-ID, as they work to build out their own reform legislation on top of the bill, S. 1217, filed earlier this year by Sens. Bob Corker, R-TN, and Mark Warner, D-VA. Johnson said...
A significant number of issuers, lenders, consumer advocates, congressmen and even some investors are urging federal regulators to conform to the definition for qualified residential mortgages with the Consumer Financial Protection Bureau’s standards for qualified mortgages. However, securitization industry participants have raised a number of other concerns about the risk-retention rule required by the Dodd-Frank Act. The DFA requires that certain securitized assets that don’t meet qualification standards should be subject to mandatory risk retention of at least 5 percent by the issuer or lender. Lenders and consumer advocates widely agree...
Committee Chairman Tim Johnson, D-SD, said the structure of the government guaranty for MBS “must be explicit, appropriately priced, and stand behind private capital that is not guaranteed.”
JPMorgan Chase’s settlement with the Federal Housing Finance Agency regarding representation and warranty claims on non-agency mortgage-backed securities could prompt large settlements by other banks, according to industry analysts. Chase agreed last week to pay $4.0 billion to settle claims on $33.8 billion of non-agency MBS purchased by Fannie Mae and Freddie Mac. The securities were issued between 2004 and 2007 by Chase, Bear Stearns and Washington Mutual. The settlement sets a “relatively high bar” for ...
Wells Fargo originated nearly one out of every five jumbo mortgages completed in 2012, according to a new analysis and ranking by Inside Nonconforming Markets of Home Mortgage Disclosure Act data. Wells had a 17.8 percent share of the $220.51 billion in non-agency jumbo mortgages originated last year, more than double its nearest rival. The origination volumes are based on one-unit conventional loan limits for specific metropolitan statistical areas and the $417,000 conforming loan limit [Includes one data chart] ...
As credit standards continue to tighten in the face of soon-to-be-implemented regulations, potential nonprime borrowers will increasingly find themselves marginalized in the mortgage market, according to Lewis Ranieri, the former Salomon Brothers vice chairman who helped pioneer mortgage-backed securities four decades ago. In a new white paper Ranieri co-authored, he makes the case that mortgages with credit scores below 680 are currently considered subprime, while the subprime cutoff before the ...
Lenders are urging federal regulators to conform the definition for qualified residential mortgages with the qualified mortgage standards established by the Consumer Financial Protection Bureau. While regulators suggested that stricter standards for QRMs would prompt securitizations of non-QRMs, lenders warn that such standards would be onerous and likely significantly reduce non-agency mortgage originations and securitization. The Dodd-Frank Act requires federal regulators to establish risk-retention ...
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