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Inside Nonconforming Markets

April 21, 2006

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Consumer Groups Seek Limits on Nontrads

A proliferation of badly underwritten, poorly disclosed, nontraditional mortgage products is putting borrowers significantly at risk, consumer advocacy groups have warned. The warnings were sounded often in comment letters filed with federal bank and thrift regulators on proposed guidance that would set new standards for the origination, marketing and sale of such products as interest-only loans and option adjustable rate mortgages. … Read More

Alt A Lenders Still Find Securitization Attractive

The Alternative A market is one of the fastest growing segments of the housing finance sector. But where are all of those new loans going? A new Inside Alternative Mortgages analysis suggests that a sizable portion is finding its way into the securitization market. According to data compiled by the Inside Mortgage Finance MBS Database, $75.23 billion in new Alt A loans were securitized during the first three months of this year, a 26.3… Read More

Amherst Touts Alt A Conduit Through SN Capital

A Texas-based firm has stepped up its market efforts to build a conduit that will buy Alt A mortgages from correspondents around the country. “Our unique income and asset verification combinations, ease of delivery and flexible forward delivery program with two-way pair offs are a combination that uniquely meets the needs of today’s correspondents,” said Phillip Daskevich, president of Amherst Funding Group. “The capital markets will appreciate our approach to production quality and our… Read More

Senderra Builds Business on Speed, Reliability

A fledgling mortgage bank is expanding from its base in North Carolina with an eye on using technology to build a national platform for delivering Alt A and subprime mortgages. “Our motto is three words, ‘prompt, simple, and friendly,” said Charles “Brad” Bradley of Senderra Funding. Headquartered in Charlotte, the wholesaler is currently offering loans in 10 states, including Florida, Indiana, Maryland, Michigan, Minnesota and the Carolinas, with plans to add 10 more within… Read More

Impac Sees Opportunity in REIT Struggles

The struggle of real estate investment trusts to make profits in a hypercompetitive mortgage market apparently isn’t fazing executives at Impac Mortgage Holdings. In fact, while its competitors consider significant changes to their business models, Impac’s executives are preparing to seize what they see as new opportunities to capture Alt A business. … Read More

Bill Could Make FHA a Player in Alt Loan Market

Is the FHA trying to position itself to offer a popular alternative mortgage product? Buried inside legislation sent to Congress last week is language that could put FHA in the nontraditional mortgage market by allowing it to insure 40-year loans. But agency officials told Inside Alternative Mortgages that they don’t plan to launch an extended amortization product – at least not right away. “Our top priority is to develop an array of flexible downpayment… Read More

Fears of Downturn Don’t Cool Interest in HELs

Fear of a housing price bubble appears to be taking hold with consumers, with a majority now expecting a collapse to occur. Still, that concern apparently hasn’t chilled demand for home-equity products. That was the key message that emerged from a recent survey of more than 1,000 adults surveyed by polling firm Gallup as part for its monthly Experian-Gallup Personal Credit Index. The poll, which was conducted in March of this year, aims to… Read More

Appreciation Could Shape Future of Option ARMs

Will option adjustable-rate mortgage morph into a consumer-lending product that borrowers use to finance consumption? The answer will depend on what happens in the housing market, a new analysis by Dominion Bond Rating Service suggests. One of the mortgage market’s most controversial products, option ARMs allow borrowers to choose among minimum payment, interest-only, and fully-amortized payment options each month. Analysts have become concerned that the risks associated with the products have been increased through… Read More

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