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Volume 2014 - Number 34

September 11, 2014

Nonbank Mortgage Company Capital Requirements Should Focus on Lending, Securitization, KBRA Says

Federal regulators should craft capital requirements for nonbank mortgage companies that emphasize areas of risk that demand adequate capital and profitability, such as lending and mortgage securitization, instead of areas that are more connected with operational efficiency and compliance, such as loan servicing, according to the Kroll Bond Rating Agency. The Federal Housing Finance Agency is trying to determine how much capital a nonbank mortgage company involved in lending, securitization and/or servicing needs in order to minimize the potential risk to the government-sponsored enterprises, while Ginnie Mae is researching the risk posed by nonbank issuers. ďHow much capital does a nonbank seller/servicer need...

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With originations expected to drop in 2018, will your shop turn to non-QM/non-prime mortgage products as a way to bolster volumes?

Yes, definitely. We’re planning a launch.


No. It’s still difficult compliance/regulatory-wise.


Maybe. It’s under consideration.


Not now. But things could change as 2018 progresses.