The share of new home mortgage originations packaged into MBS drifted slightly lower in the first quarter of 2016, a new Inside MBS & ABS analysis reveals. Some $255.7 billion of newly originated mortgages were pooled in MBS in the first three months of the year, representing a paltry 67.3 percent of the estimated $380 billion of first-lien originations in the primary market. For the purposes of calculating securitization rates, loans aged more than three months and modified loans are excluded from agency MBS issuance figures. Fannie Mae and Freddie Mac securitized...[Includes one data table]

It was thought that with the Consumer Financial Protection Bureau working on a new regulation to clarify key portions of the TRID integrated-disclosure rule and assignee liability that the scratch-and-dent market in TRID-defective loans would grind to a halt. But that’s not how it’s turned out. According to investors in “S&D” TRID mortgages and traders who play in the space, auctions of mortgages with errors (of all sorts) have continued...

Investors who are suing the government over the terms of the conservatorships of Fannie Mae and Freddie Mac said the 53 documents recently made public solidify their claim that the government-sponsored enterprises had plenty of capital and a government bailout was unnecessary. The Treasury Department provided the documents to plaintiffs last week as part of a court case in Kentucky. “The newly de-designated documents also suggest...

Mortgage brokers grabbed a slightly bigger share of the originations market in the first quarter of 2016, according to a new Inside Mortgage Finance ranking and analysis. Mortgage brokers generated an estimated $38 billion of new home loans during the first quarter, a modest 2.7 percent increase from the previous period. Meanwhile, correspondent production declined by 0.8 percent to an estimated $122 billion and retail originations weakened by 2.2 percent. There appeared...[Includes four data tables]

Examination reviews by the Consumer Financial Protection Bureau for compliance with the integrated disclosure rule known as TRID are now in full swing, according to leading industry attorneys. That was the biggest take-away from a panel of three legal experts who were featured in a webinar hosted by Inside Mortgage Finance late last week that focused on CFPB examinations and how lenders can navigate their way through them. Although TRID was not a key focus of the webinar, it did come up as a topic during the question-and-answer period. The attorneys were asked...

A ruling last week by the Supreme Court of the United States was viewed by the Mortgage Bankers Association as potentially making it harder for plaintiffs to win class-action certifications. Spokeo, Inc. v. Robins involves alleged violations of the Fair Credit Reporting Act. Thomas Robins filed a class-action lawsuit against Spokeo, alleging that his profile on the firm’s website contained inaccurate information. Spokeo is an online aggregator of individuals’ contact- and credit-information. The case was initially dismissed...

After nearly five years of legal entanglements, investors will soon receive their share of the $8.5 billion Bank of America agreed to pay in June 2011 to resolve legacy mortgage-repurchase and servicing claims associated with Countrywide Financial Corp. The payouts were delayed by legal wrangling over whether trustee Bank of New York Mellon had the authority to settle. Last year, the New York Supreme Court ruled in the trustee’s favor, and a state court judge recently approved the severance order and partial final judgment, which cleared the way for BNYM to begin distributing the settlement proceeds from 512 of the 530 trusts in the case. Twenty-two investors that suffered significant losses for their failed investment in MBS sold by Countrywide prior to the collapse of the housing market are...

The Consumer Financial Protection Bureau’s proposed rule that aims to effectively end the use of arbitration clauses in U.S financial product contracts will create new risks for ABS tied to consumer loans as well as related financial services companies, according to Moody’s Investors Service. “The fact that the proposed rule would not affect contracts outstanding before it is finalized would lessen its effects initially, as well as over the longer term for contracts on products that typically have long lives, such as credit cards,” analysts from Moody’s said. “Nevertheless, if adopted, the rule would expand legal risks for banks and other financial companies, and could adversely affect some securitizations.” That being said, “Some of the negative effects, however, would be offset...

Over the past two weeks, MBS prices have been on a downward trajectory, leading some market watchers to ponder whether the long-awaited correction in values is finally upon the industry. But no one is quite ready to wave the white flag. Moreover, there’s a school of thought that says any rise in the yield on the 10-year Treasury bond could be short lived and, at some time over the next six to 12 months, rates might head south again, igniting yet another small refi rally. Some also believe the chance of a recession is in the cards. Barry Habib, who runs MBS Highway, a rate-locking advisory service, thinks...

HUD Sends Final Condominium Rule to OMB for Clearance. The Department of Housing and Urban Development has sent a final rule to the Office of Management and Budget that would make it easier for borrowers to obtain FHA financing for certified condominium units. Once issued, the final rule will replace temporary guidance which HUD issued in November last year to ease FHA’s condo approval process. The move is aimed at increasing affordable housing options for first-time and low-income homebuyers. The final rule is expected to reflect measures in the interim guidance, including modification of the requirements for condo project recertification, revised calculation of FHA’s required ownership-occupancy percentage, and expansion of eligible condo-project insurance coverages. IG Scrutinizes HUD Oversight of SFHAs’ Downpayment Assistance Programs. Residential lenders that rely on ...