MBS investors are keeping a close eye on the auction of Ditech Financial. The troubled nonbank is a top-ranked servicer of Ginnie Mae product. The biggest fear: The company will run out of cash.
The trading volume was decent during April but paled in comparison to most other months this year. Meanwhile, investors are worried about the usual: declining interest rates and prepayment rates. And a new wild card has emerged: A possible rate cut by the Fed.
The firm detailed its residential mortgage-related assets under management in a recent filing, demonstrating its dominating presence in the housing-finance market.
FHFA Director Mark Calabria has vowed not to monkey with the 30-year FRM or lower loan limits in high-cost states like California. Still, certain stakeholders worry he may try to adjust other areas of businesses.
So, you thought it was safe to re-enter the Ginnie Mae market? Maybe, maybe not. VA loan churning could be an issue again and federal investigators are asking questions about underwriting practices and delinquencies. Subpoenas have been issued.
Ginnie Mae has completed liquidity talks with its 14 largest nonbank issuers, but has yet to say what transpired during the meetings. But all that could change when the agency hosts its annual summit in June.
Nonbank servicers are increasingly moving toward a capital-light strategy, suggesting steady demand for MSR and servicing-advance financing. The investor base for such deals is strong and growing.
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