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Inside MBS & ABS

March 21, 2008

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GSEs Tapped to Inject $200 Billion of Liquidity Into MBS Market in Sudden Strategy Shift

After spending several years unsuccessfully trying to convince Congress to curtail the roles played by Fannie Mae and Freddie Mac in the mortgage market, the Bush administration this week made a political u-turn and pushed the government-sponsored enterprises... Read More

JPMorgan Chase’s Acquisition of Bear Stearns Suggests More Consolidation in MBS Market

The planned acquisition of Bear Stearns by JPMorgan Chase would further consolidate a non-agency MBS market that has been nearly dormant for four months. Based on 2007 data, the combined operations of Bear Stearns and Chase would have accounted for... Read More

Foreigners Become Largest Single Investor Class in U.S. Mortgage Securities Market

As a group, overseas investors now hold a bigger stake in the U.S. mortgage securities market than any other major institutional class, according to a new analysis by Inside MBS & ABS. As of the end of 2007, foreign investors owned an estimated... [Includes two charts] Read More

State Foreclosure Prevention Plans Threaten to Cause Uncertainty for Investors, Raise Costs for Borrowers

A handful of states are working on foreclosure prevention legislation that could inject substantial uncertainty into the mortgage securitization process for investors, and raise the cost of mortgage financing for borrowers. The measure that has advanced the... Read More

Alt A MBS Ratings Under Review, ‘Substantial’ Downgrades Expected, Including AAA Classes

The rating services are in the midst of an exhaustive review of the ratings on Alt A MBS. “Substantial downgrades will result in many instances,” warned Glenn Costello, a managing director at Fitch Ratings. On a call this week describing Fitch’s review, Costello... Read More

Subprime Writedowns May be More than Halfway Over, S&P Says, but Major Subprime MBS Downgrades Remain

Reports by Standard & Poor’s last week that the majority of subprime writedowns have already been taken boosted confidence in the financial markets, possibly prematurely. A recent analysis by Bloomberg found that S&P and Moody’s Investors Service failed to... Read More

House Lawmakers Revise Legislation Proposing Safe Harbor for Servicers Modifying Mortgages

Revised legislation introduced in the House is designed to give mortgage servicers greater legal certainty in arranging loan modifications without trampling on the rights of MBS investors. H.R. 5579, the Emergency Mortgage Loan Modification Act... Read More

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