Industry experts agree that the commercial MBS market is not going to live up to expectations of $100 billion of issuance this year, but they are hopeful the market will rebound after the industry fully implements the Dodd-Frank Act risk-retention rules that take effect Dec. 24, 2016. According to Kenneth Cheng, managing director of CMBS ratings services for Morningstar Credit Ratings, there is much uncertainty in the CMBS market about the actual impact of the risk-retention requirements. “I think everybody has agreed that it will be a negative impact – it’s just the magnitude of that impact that is uncertain,” he told Inside MBS & ABS this week. “It’s going to drive up the cost of CMBS – how much is anybody’s guess.” Also, as the cost of issuing CMBS increases, profit margins will...
"Liquidity provides the grease that allows capital markets to operate freely," said Rodrigo Lopez, chairman-elect of the Mortgage Bankers Association. "We are currently experiencing a lack of liquidity, not a lack of cash."
While Republicans continue to work toward decreasing the CFPB’s powers, former CFPB enforcement attorney Jennifer Lee suggests that with a divided Congress, the most significant power over the CFPB could be in courts.
Black Knight Financial Services reported net earnings for the second quarter of 2016 of $11.40 million compared with net earnings of $0.30 million in the previous quarter.
The after-mitigation defect rate on FHA mortgages increased from 5.5 percent in the fourth quarter of 2015 to 8.4 percent in the first quarter of 2016.
Analysts at Morningstar Credit Ratings suggest that most non-agency MBS backed by new mortgages will be subject to full reviews due to uncertainty regarding the TILA-RESPA Integrated Disclosure rule.
Applications for refinances decreased slightly last week compared with the week prior, according to the Mortgage Bankers Association, as average interest rates on mortgages increased during the week.
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