Fannie Mae and Freddie Mac are designing a securitization framework that will work for today’s fully-guaranteed residential MBS as well as securities with a partial government guaranty or none at all, according to an update released this week by the Federal Housing Finance Agency. Among the initiatives set for the government-sponsored enterprises by the FHFA is the development of a contractual and disclosure framework designed to give MBS investors more clarity and confidence about what they’re…

A rough measure of production profitability, the ratio of production income to origination volume, fell from 179 basis points in the second quarter to just 84 bps in the third. Back in the Wonderland of early 2012, this ratio was 203 bps.

The jumbo market accounted for 16.7 percent of total mortgage originations during the third quarter of 2013 and was much stronger than other sectors.

During the first nine months of 2013, there were 512 different companies that sold mortgages to the government-sponsored enterprises that had been originated by loan correspondents of mortgage brokers. Some 324 of these lenders were involved in the broker-wholesale channel.

Elsewhere, in the report FHFA claims significant progress has been made on the development and initial testing of the GSEs’ common securitization platform.

Meanwhile, a new report from Compass Point Research is predicting that the FHFA will establish a final risk-to-capital threshold for MIs of 18:1.

“Watt will not lower the ceiling for 2014,” said one mortgage insurance executive. “Maybe, he will change them at some point but, not next year.”

HUD has been steadily auctioning off nonperforming mortgages the past few months. Sources in the market disclosed to IMFnews who some of the winning bidders are. They include: Credit Suisse, Ellington, Kondaur, PIMCO and Varde.

The "good" news for lenders is that interest in the mortgage industry is still strong despite declining volumes and shrinking profit margins.

As a group, banks and thrifts reported net earnings of $4.76 billion on their mortgage-banking activity during the third quarter, a 42 percent drop from the second quarter.