S&P Global ranked as the top rating service in the non-mortgage ABS market during the first half of 2017, with strong market shares in the major asset categories, according to a new ranking and analysis by Inside MBS & ABS. S&P rated $69.54 billion of ABS issued in the first half of the year, roughly 60.1 percent of total issuance by dollar volume. For all of 2016, the company finished second in ABS ratings with a 53.6 percent share of the market. S&P had...[Includes two data tables]

Nonprime lenders defended mortgages underwritten with borrowers’ bank statements after criticism of the loans by Fitch Ratings. Steven Schwalb, CEO of Angel Oak Home Loans, a nonprime lender that offers bank-statement mortgages, noted that the loans measure borrowers’ cash flow more precisely than the tax returns used for traditional income verification. “We’re comfortable with the risk of that borrower,” he added, during a panel discussion at the ABS East conference produced by Information Management Network last week in Miami Beach. Bank-statement mortgages account...

Redwood Trust made a couple of adjustments to its new jumbo mortgage-backed security between when presale reports were issued and when the deal closed. Among other changes, the size was reduced slightly due to uncertainty about the impact of damage from Hurricane Irma on certain properties. Redwood removed 12 mortgages from the loan pool, dropping the unpaid principal balance of the MBS from $316.49 million to $307.64 million, according to Moody’s Investors Service. Seven loans were dropped...

Originations of nonprime mortgages in 2017 are the strongest they have been since the financial crisis but remain well below levels seen before then. Lenders are looking to lean on loan originators and borrowers in an effort to increase volume. Angel Oak Companies is on track to originate more than $1.1 billion of non-qualified mortgages this year, according to the firm. The nonbank has three lending units that largely focus on nonprime mortgages and the $1.1 billion in production will be a company record. “Clearly, investors, brokers and consumers are...

Mortgage lenders sold $49.74 billion of high-cost home loans to a variety of secondary market investors last year, according to a new Inside Nonconforming Markets analysis of Home Mortgage Disclosure Act data released late this week. Sales of high-cost mortgages rose 19.1 percent from 2015 to 2016, and accounted for 3.3 percent of total loans sold last year. HMDA reports are required to flag loans with interest rates that exceed the benchmark prime offered rate – basically the rates for Freddie Mac mortgages – as well as loans that are subject to special consumer protections under the Home Owner Equity Protection Act. Sales of HOEPA loans totaled...[Includes one data table]

A previously obscure FHA program for properties in designated disaster areas is getting more interest from lenders in the wake of hurricanes Harvey and Irma. According to FHA data, there has been a noticeable increase in loans originated under the FHA 203(h) mortgage insurance program, which is designed specifically for hard-hit homeowners in presidentially declared major disaster areas (PDMDA). Origination under the 203(h) program rose from $17.8 million in 2015 to $64.1 million in 2017, data showed. Use of the 203(h) product spiked in the fourth quarter of 2016, when 180 loans totaling $34.0 million were originated, up from 47 in the previous quarter and 26 loans from the same period in 2015. The U.S. experienced more floods in 2016, 19 in all, than any year on record, according to an analysis by Munich Re, a global reinsurance firm. In post-hurricane guidance, FHA urged lenders to ...

Drawing to a close, the third quarter of 2017 is turning out to be modestly better than some lenders expected with both profits and production volumes getting a second wind recently thanks to falling interest rates. “We’re having a great quarter,” said Mat Ishbia, president and CEO of United Wholesale Mortgage, Troy, MI. According to Ishbia, not only will UWM post record originations of $8.6 billion in the third quarter, but volume at the privately held nonbank will be about 20.0 percent higher than ever before. According to figures compiled by Inside Mortgage Finance, UWM is...

Anecdotal and empirical evidence confirm that mortgage lenders are continuing to lighten up on their underwriting criteria. The loosening may not be as pronounced as it was in the run-up to the financial crisis, but there are concerns that it will intensify as the Federal Reserve raises interest rates. Fannie Mae’s latest mortgage lender sentiment survey found that more lenders said they have eased credit standards than tightened them, something the government-sponsored enterprise attributed to limited demand for residential finance and a negative outlook on profit margins. “The net share of lenders reporting easing of credit standards over the prior three months has continued...

Resolving the long-running conservatorships of Fannie Mae and Freddie Mac is drawing a lot of attention, but policymakers and industry groups don’t seem any closer to a consensus. For the most part, the executive branch and many groups representing large financial institutions want Congress to tackle the problem through legislation. Investors and some groups representing smaller lenders say the Federal Housing Finance Agency and Treasury could do more to pave the way. Motivating the debate is...

The mortgage servicing market maintained its steady growth pattern during the second quarter of 2017, inching up 0.7 percent to $10.430 trillion, according to new Federal Reserve data. That was the biggest number for mortgage debt outstanding since the first quarter of 2011, when the market stood at $10.439 trillion. Most of the growth has been in Fannie Mae, Freddie Mac and Ginnie Mae servicing but portfolio holdings of whole loans are also on the upswing. There was...[Includes two data tables]