Bank of America retained 94% of its mortgage originations in the fourth quarter of 2019, a much higher retention rate than other big banks. Officials at the bank said BofA’s loans offer better yields than MBS.
The CFPB is considering eliminating the DTI ratio metric when determining the QM status of a mortgage and instead basing the designation on the interest rate. The proposal was met with mixed reactions.
Presale reports for five prime non-agency MBS have been published in the past two weeks, including two deals from JPMorgan Chase. Many of the loans were funded by nonbanks and are eligible for sale to the GSEs.
To avoid retaining risk in securitization deals, mortgage lenders are joining hands with investors who act as “co-sponsors” and take on the first-loss position.
Issuance of aircraft-related ABS is expected to shoot up in the coming years but industry analysts are warning about potential performance issues. Fitch said it’s taking a cautious approach to rating new deals.
The Financial Stability Oversight Council would have to complete a number of steps before it can subject nonbank lenders and servicers to increased over-sight and prudential standards.