The easing of qualified-mortgage standards under the Dodd-Frank reform bill could be credit negative for nonprime residential MBS backed by loans originated by nonbanks, Moody’s Investors Service said. But an industry expert disagrees.

Non-agency MBS investors might not be aware of the differences in representations and warranties provided by issuers of new non-agency MBS, according to Fitch Ratings. In a recent report, the rating service noted that issuers are diverging from standard practices in terms of “full” rep-and-warrant frameworks.

The spring homebuying season fueled a relatively modest increase in production of Ginnie Mae single-family mortgage-backed securities during the second quarter of 2018, according to a new Inside FHA/VA Lending ranking and analysis. Lenders issued $98.66 billion of Ginnie MBS backed by forward mortgages during the April-May cycle. That was up 6.6 percent from the first three months of the year, but 2018 continued to lag behind the pace set in 2017 by 10.7 percent. Given current trends, annual Ginnie MBS issuance in 2018 could fall short of the $400 billion mark for the first time since 2014. The flow of FHA and VA purchase mortgages was up a solid 23.7 percent from the first to the second quarter, bringing the total for the first half of the year to $121.01 billion. However, that was down 4.7 percent from the same period in 2017. Ginnie securitized $75.02 billion of FHA purchase loans in the ... [Charts]

Freddie Mac saw a strong rebound in its single-family business during the second quarter following a sluggish start to the year. Freddie guaranteed $82.23 billion of single-family mortgage-backed securities during the second quarter, a romping 28.6 percent increase from the first three months of the year. The GSE produced just $63.93 billion of MBS in the first three months of 2018, its slackest quarter in almost four years. Fannie’s single-family business was off slightly in the second quarter as MBS issuance declined to $111.36 billion – its weakest output since the first three months of 2016. [Includes two data charts.]

DBRS maintained its lead position as the top rating service in the non-agency MBS market during the first quarter of 2018, according to a new Inside MBS & ABS ranking. [Includes two data charts.]

Ginnie Mae has added a new metric to make it easier for approved issuers to track the prepayment rates of single-family loans underlying they have delivered into mortgage-backed securities. The new prepayment metric would enhance Ginnie’s Issuer Operational Performance Profile (IOPP) tool, which was launched in 2015 to help issuers measure their performance against the agency’s standards. The new tool is the latest move by Ginnie to ensure the integrity and market predictability of Ginnie MBS. The prepayment tool will be available to lenders beginning June 25. The announcement follows an agency administrative action last week against three VA lenders that were penalized for cherry picking and refinancing unseasoned VA loans not to benefit borrowers but to charge them higher fees. The lenders – Freedom Mortgage, SunWest Mortgage Co. and NewDay USA – were among nine issuers that ...

The average daily trading volume in agency MBS climbed to $226.1 billion in May, the second consecutive monthly increase, according to figures compiled by the Securities Industry and Financial Markets Association.

ABS issuers are boosting the quality of marketplace loans in new deals due to rising delinquency rates, but not enough to convince Fitch Ratings that such issuance deserves AAA ratings.

Reverse mortgage lenders started out strong in the first three month of 2018 with a 19.2 percent increase in Home Equity Conversion Mortgage production from the previous period. HECM endorsements totaled $5.4 billion in the first quarter, with purchase reverse loans accounting for the bulk of originations, 81.9 percent. First quarter production was up 18.5 percent from the same period last year. Meanwhile, HECM mortgage-backed securities issuance totaled $2.97 billion for the quarter, down from $3.25 billion in the prior quarter, Ginnie Mae data showed. The top five HECM originators in sequential order – American Advisors Group, Reverse Mortgage Funding, One Reverse Mortgage, Liberty Home Equity Solutions, and Synergy One Lending – accounted for $1.66 billion, or 30.8 percent, of total production during the first quarter. American Advisors maintained its top ranking with $841.4 million of HECM loans, which ... [Charts]

Ginnie Mae this week warned that VA refinance loans, particularly Interest Rate Reduction Refinance Loans, may not be included in any new pool or loan package if they do not comply with the newly enacted law protecting VA borrowers from predatory lending. The agency announced new pooling guidance pursuant to the loan-seasoning provision in the Economic Growth, Regulatory Relief, and Consumer Protection Act, which President Trump signed into law last week (See details of the new law below ). The changes affect issuances of Ginnie mortgage-backed securities on or after June 1, 2018, but do not affect MBS issued before that date, according to the guidance. However, lenders seeking a guarantee after June 1 may have to recalibrate their loan-origination platforms to exclude refis that do not meet the new law’s seasoning requirements, said the Structured Finance Industry Group. The ...