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Inside Nonconforming Markets

August 8, 2008

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Alt A Hammers GSEs, Fannie to Quit Market

The government-sponsored enterprises this week reported significant deterioration in their Alt A experience during the second quarter of 2008, leading Fannie Mae to announce that it will shut down its program by the end of this year. “After considered analysis, we will eliminate newly originated Alt A acquisitions by year end,” Fannie Mae stated in its quarterly... [Includes one chart and one graph] Read More

GSE Alt Mortgage Volume Up Slightly in July

Although new production of mortgage-backed securities at Fannie Mae and Freddie Mac dropped sharply in July, delivery of various alternative mortgage products to the two government-sponsored enterprises actually increased slightly. The uptick in GSE alternative mortgage production was the result of both companies ramping up their so-called conforming... [Includes one chart] Read More

GSEs Tasked to Develop Underserved Products

Given the growing problems Fannie Mae and Freddie Mac have been forced to cope with from Alt A and subprime mortgages, the last thing the government-sponsored enterprises may want is a new statutory directive to address the “underserved” mortgage market.But the new Housing and Economic Recovery Act does exactly that, giving the GSEs orders to stimulate a secondary market for... Read More

‘Rescue Loans’ May Get FHASecure Pooling

One of the issues in launching any alternative mortgage product is trying to get the best possible secondary market execution to make the new loan competitive with existing programs. The government’s ambitious new FHA refinance program for underwater borrowers may be able to piggyback on an existing Ginnie Mae MBS program, according to a top agency official, but that could still leave... Read More

Details Emerge on GreenPoint/NY AG Settlement

A settlement reached in 2007 with New York State will cost former Alt A powerhouse GreenPoint Mortgage $1 million, New York Attorney General Andrew Cuomo recently revealed. While GreenPoint settled regarding allegations, Cuomo said an investigation into potential discriminatory pricing by mortgage brokers that did business with GreenPoint is ongoing. GreenPoint, now a unit of... Read More

Rating Services Revise Alt A Loss Assumptions

Alternative mortgages originated in recent years continue to plumb new depths in credit performance, forcing credit rating services to ratchet higher their loss expectations for the sector. Fitch made major enhancements to ResiLogic, its loan-level default and loss model, to raise foreclosure frequency and loss severity assumptions about Alt A loans. It also revised its forecast to... Read More

MountainView Sets its Sights on Distressed Assets

Distressed mortgage assets may be the biggest boom market on the horizon for the alternative mortgage business, and a growing number of investment funds are looking to snag these floundering loans at fire sale prices. MountainView Capital Holdings, LLC, a Denver-based investment company, is among the growing number of investors buying a stake in the expanding market in subperforming Alt A and... Read More

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