Housing industry groups are making a noisy push to persuade policymakers to postpone (perhaps permanently) a planned reduction in the high-cost loan limits for Fannie Mae, Freddie Mac and the FHA due to expire this fall. Late last week, the National Association of Home Builders released a study which concluded that an Oct. 1 reduction in the loan limits will reduce housing demand and place downward pressure on home prices in major housing markets. In February, the White House proposed to shrink the governments footprint in housing finance and lure back ...
The Consumer Financial Protection Bureau isnt wasting any time in moving forward with its know before you owe integrated mortgage disclosure project. Late last week, it released highlights of the thousands of comments it received from the first round of its disclosure prototypes, and early this week it issued a second set of forms for public comment, this time focusing on borrower payments or fees necessary to close a mortgage. In the first round of prototypes (dubbed Ficus Bank and Pecan Bank), the back page was the same on both versions, whereas the front page ...
The fledgling Consumer Financial Protection Bureau sees its role as helping credit markets work better to enhance viable homeownership and level the playing field in credit availability, according to key officials participating in the Mortgage Lending Industry Strategic Markets & Diversity Conference sponsored last week by ComplianceTech. We realize now that building wealth and homeownership is a risky proposition and one that should not be taken lightly, said Patricia McCoy, assistant director of mortgage and home equity at the CFPB. Our job is to ...
Total capital in the FHA single-family program declined again in the first quarter of 2011, although agency officials say the program is on target to meet legal mandates as higher premiums and stronger loan quality gradually offset poorly performing older loans. In a quarterly report released this week, the Department of Housing and Urban Development said total capital resources for the FHA Mutual Mortgage Insurance Fund declined by $1.1 billion to $31.6 billion during the first three months of 2011. At the same time, the outstanding balance of single-family insurance at risk rose ...
The Federal Housing Finance Agency, Ginnie Mae and the government-sponsored enterprises should add another potential alternative servicing fee structure in their deliberations to revamp the compensation structure for residential servicing, according to the Mortgage Bankers Association. Last week the MBA sent a letter to the FHFA, Ginnie Mae, Fannie Mae and Freddie Mac pitch-ing the merits of a Reserve Account Proposal, requesting the proposal be included among the options expected to be released for public comment within the next month. The Reverse Account Proposal would set up ...
Lawmakers on the House Financial Services Committee this week approved by a wide bipartisan margin a bill that would create the legislative framework for a covered bond market in the U.S., but not before some haggling regarding the role of the federal regulators. The committee voted 44-7 in favor of H.R. 940, the U.S. Covered Bond Act of 2011, clearing the way for the bills consideration by the full House of Representatives. Rep. Scott Garrett, R-NJ, chairman of the House Financial Services Subcommittee on Capital Markets and Government-Sponsored Enterprises, said H.R. 940 sets up legal certainty that is a core element of...
The challenges confronting the recovery of the non-agency MBS market are many, but legacy issues, such as representations and warranties, are the cause of huge frustration in the industry, according to panelists at the American Securitization Forum this week. Some of these legacy issues have very far-reaching tentacles, observed Mani Sabapathi, principal at Prudential Fixed Income. The housing finance world has been bracing for the coming risk-retention rule with great apprehension, he said, raising the possibility that reps and warrants could be included as a part of it. I think it can be an important aspect to the extent that if you have these loans that dont meet...
The securitization industry is largely supportive of fails-charge recommendations by the Treasury Markets Practice Group to help reduce fails in the agency debt securities and agency MBS markets, but did offer a number of constructive considerations for the group to review. The Securities Industry and Financial Markets Association told the TMPG, an advisory group of market representatives sponsored by the Federal Reserve Bank of New York, that its members share concerns about elevated levels of settlement fails in MBS markets, which the TMPG is trying to address in the recommendations it released in late April. SIFMA members agree that...
The governments top securities industry regulator rejected some of the pushback against the huge volume of new regulations for the MBS and ABS market, while reporting that officials are working to address some major concerns as they finalize the rules. Efforts to implement the reforms that would bring investors back to the markets are being met with strong and what I believe to be short-sighted resistance, said Mary Schapiro, chairman of the Securities and Exchange Commission, during a speech at this weeks American Securitization Forum annual meeting. In the aftermath of the crisis, would-be investors are waiting for needed reforms in...
Real estate investment trust Walter Investment Management Corp. announced late last week its closing of a $102 million private placement of non-agency MBS. The purpose of the transaction is to help pay for Green Tree Credit Solutions, which Walter Investment acquired in March for $1.065 billion. Green Tree carries a $37 billion servicing portfolio, mostly for other investors, according to Inside Nonconforming Markets, an affiliated newsletter. The notes were issued by WIMC 2011-1, which is a recently-formed statutory trust sponsored by Walter Investment. As we near our anticipated early third quarter completion of...