New York has set a six-year statute of limitation to bring charges under the Martin Act. The deadline issue has been a bone of contention in a court case between the state attorney general and Credit Suisse.
Higher-priced mortgages are a regulatory designation based on the comparison of the annual percentage rate on a mortgage with the average prime offer rate, which tracks rates offered to prime borrowers.
After the transaction closes, business-purpose lending investments will account for more than 15% of Redwood's investment portfolio, up from a 4% share.
The new MBS differs in some ways from previous expanded-credit issuance from Annaly, including a reduced reliance on mortgages from Banc of California and an increase in investment-property loans.
Issuance of expanded-credit MBS more than doubled on an annual basis at the end of the third quarter while deals backed by prime mortgages and GSE-eligible loans declined. The expanded-credit sector is expected to continue to grow, according to industry analysts. (Includes data chart.)
JPMorgan Chase Bank has created a synthetic credit-linked note to transfer credit risk on a pool of jumbo mortgages. Unlike traditional MBS, loans in the transaction will remain on the bank’s balance sheet.