Facing a statute of limitations deadline, the Federal Housing Finance Agency filed lawsuits against 17 firms last week in an effort to recover losses the government-sponsored enterprises suffered on their investments in non-agency mortgage-backed securities. The FHFA claimed violations of securities laws, alleging that non-agency MBS prospectuses contained material false statements and omissions. The lawsuits relate to more than $196.2 billion in non-agency MBS purchased by the GSEs. The GSEs combined holdings of subprime and Alt A MBS have declined since at least the fourth quarter of 2007 when they totaled $217.2 billion, according to an analysis by Inside Nonconforming Markets,. ...
The American Securitization Forum positioned its new model repurchase principles as a better option to restore investor confidence in non-agency mortgage-backed securities than the risk retention required by the Dodd-Frank Act. The risk-retention rules proposed by regulators are not sufficiently tailored to different asset classes and will likely cause a host of negative unintended consequences, said Tom Deutsch, executive director of the ASF. ...
The Securities and Exchange Commission this week asked for public comment as it begins to reconsider whether mortgage real estate investment trusts and other mortgage-related pools that acquire mortgages and mortgage-related instruments should remain exempt from the requirements of the Investment Company Act. The SEC said it is concerned that some mortgage-related pools, as pooled investment vehicles, may raise...
Banks and thrifts held a record $1.491 trillion of residential MBS in portfolio as of the end of June, according to a new Inside MBS & ABS analysis and ranking of call report data. That was up 1.6 percent from the end of the second quarter and marked the fourth consecutive period of growth in the industrys MBS holdings. Banks and thrifts owned about 22.8 percent of the estimated $6.535 trillion of MBS outstanding at the end of the second quarter. All the growth came in investments in agency structured finance transactions, mostly REMICs. Bank and thrift holdings of agency REMICs jumped 8.6 percent in the second quarter to $459.9 billion, or 30.8 percent of... [Includes two data charts]
Any modified FHA or VA loan can now be repurchased from a Ginnie Mae MBS if the borrower successfully completes a three-month trial period under a policy shift to align with the FHA version of the Home Affordable Modification Program. Ginnie made the announcement on Aug. 26, effective immediately. Before the policy change, loans had to have missed three full payments before qualifying for a repurchase. Issuers can buy out loans that have remained in pools while borrowers made partial payments for at least three consecutive months under an FHA or VA trial payment plan that is a condition to a permanent modification, Ginnie explained. Until the loan has been...
Fannie Mae made its second foray of 2011 into the non-agency MBS market by providing a guarantee wrap on a $690.6 billion deal backed by previously modified FHA and VA mortgages. Government Loan Securitization Trust 2011-FV1 is comprised of government loans originated by Wells Fargo and Wachovia. All the loans were previously securitized in non-agency MBS backed by Fannie wraps, including some that date back to 2001. The average age of the loans since modification is 132 months, and 91.2 percent of them are insured by the FHA. According to the prospectus, 19.8 percent of the loans were 30-days delinquent and 35.9 percent were more than...
The Federal Housing Finance Agency this week became among the latest, most influential parties to legally weigh in on the proposed $8.5 billion Bank of America settlement over non-agency mortgage-backed securities.On Aug. 30, the deadline to file objections to the deal, the Finance Agency filed a Notice of Appearance and Conditional Objection with the U.S. District Court in Manhattan on behalf of Fannie Mae and Freddie Mac.
The Obama administration is seeking ideas from stakeholders on how to thin out the FHAs inventory of foreclosed homes, including turning the homes into rental properties to meet the growing need for affordable housing. In addition to addressing the FHAs real estate-owned, or REO, problem, the Federal Housing Finance Agency, the Department of the Treasury and the Department of Housing and Urban Development are also calling for recommendations for similar home rental programs for REO properties held by Fannie Mae and Freddie Mac. The agencies request is aimed at finding the best alternative for maximizing value to taxpayers and increasing private investment in the housing market, including ...
The Department of Housing and Urban Development has developed a new Web-based tool which allows FHA, Fannie Mae and Freddie Mac to map all foreclosed properties for viewing by potential investors and homebuyers. The new mapping tool displays the location of all foreclosed homes in the agencies inventories, which account for nearly half of all real estate-owned or REO properties in the U.S. Communities with high foreclosure rates that are participating in HUDs Neighborhood Stabilization Program (NSP) will find the REO portal useful in targeting federal funds to acquire, rehabilitate or demolish these REO properties, according to department officials. The maps consolidated graphic listing enables ...
The consensus among mortgage market watchers is that the downgrade earlier this month of the GSEs by Standard & Poors will have no immediate, detrimental impact even as Fitch Ratings this week said it is keeping Fannie Mae and Freddie Macs AAA rating.Fitch this week also said its outlook for Fannie and Freddies ratings remained stable. The move was in concert with Fitchs decision to keep its rating on U.S. debt at the highest grade.A key element of the explicit support is the guarantee by the U.S. Treasury to inject funds into Fannie Mae and Freddie Mac, so that each firm can avoid being considered technically insolvent by their regulator, said the rating agency.