NewLeaf Wholesale recently added four products to its “specialty” mortgage offerings with relatively lenient underwriting standards. The loans are aimed at borrowers who don’t qualify for conforming mortgages. The lender is now offering a jumbo mortgage that allows loan-to-value ratios up to 90.0 percent without private mortgage insurance, a residual-income product, an asset-depletion product and a product for foreign investors. The loans join NewLeaf’s other specialty products ...

With President-elect Donald Trump set to take office and Republicans in control of Congress, trade groups representing banks reiterated calls for revisions to standards for qualified mortgages. Banks are pushing for QM status to be applied to any mortgage held in portfolio, even if the loans have characteristics that would otherwise make them non-QMs subject to greater liability. In a letter this month to leaders of Congress, Rob Nichols, president and CEO of the American Bankers Association ...

Shared-equity mortgage arrangements from for-profit investors offer help for borrowers that otherwise might not qualify for a mortgage while also introducing risks, according to analysts at the Urban Institute’s Housing Finance Policy Center. In a shared-equity transaction, a third party helps a mortgage borrower purchase a home in exchange for some of the home-price appreciation. The HFPC noted that shared-equity transactions reduce the amount of money required from ...

The Department of Justice this week finalized previously announced settlements with Deutsche Bank and Credit Suisse regarding non-agency mortgage-backed security activities in the run-up to the financial crisis. The DOJ said the $7.20 billion settlement with Deutsche Bank was the single largest residential MBS resolution for the conduct of a single entity. The settlement with Credit Suisse was for $5.28 billion. Both of the settlements included civil penalties and ... [Includes two briefs]

In 2016, a mere $42.93 billion of non-agency MBS were issued, down 32.5 percent from the previous year, according to a new Inside MBS & ABS ranking and analysis. It was the second-lowest annual output since 2012. The picture would look a bit brighter if Fannie Mae and Freddie Mac credit-risk transfer deals were included, as well as single-family rental securitizations, which both compete for the investors that might be interested in non-agency MBS. But the government-sponsored enterprise CRT deals are debt issues and they couldn’t be any more “agency,” while the SFR securitizations look a lot more like commercial MBS than residential MBS. The prime jumbo market hit...[Includes three data tables]

With structured finance performance having peaked for many sectors, analysts at Fitch Rating and S&P Global Ratings anticipate some modest asset-level deterioration in 2017 – most notably in both prime and subprime auto ABS. On the other hand, they expect relatively stable performance from credit card ABS. “Both prime and subprime auto ABS loss rates could be...

Issuance of prime non-agency mortgage-backed securities fell sharply during 2016 from already low issuance levels, according to a new ranking and analysis by Inside Nonconforming Markets. Forecasts for issuance this year are largely subdued, with some industry analysts noting that the prime non-agency MBS market is “in limbo.” Some $9.32 billion in prime non-agency MBS were issued in 2016, a 22.8 percent decline from the previous year. Issuance volume ... [Includes one data chart]

A number of large investors that purchased non-agency mortgage-backed securities before the financial crisis have indicated that they won’t be willing to invest in new issuance until issuers standardize representations and warranties. “Investors have lost confidence in the architecture of this market,” an investor said in December at the Structured Finance Industry Group’s RMBS Symposium, which was produced by Information Management Network. The investor was frustrated ...

The portfolio holdings of first-lien residential mortgages at banks and thrifts continued to increase during the third quarter of 2016, according to a ranking and analysis by Inside Nonconforming Markets. Banks and thrifts held $1.93 trillion in first liens at Sept. 30, up 1.6 percent from the previous quarter and a 3.9 percent increase compared with the third quarter of 2015. Originations and acquisitions of mortgages – both jumbos and non-jumbos ... [Includes one data chart]

LendSure Mortgage, which originated its first loan in July 2015, contributed mortgages with a total unpaid principal balance of $14.62 million to a nonprime mortgage-backed security recently issued by an affiliate of Lone Star Funds. The lender focuses on non-qualified mortgages via the broker channel. LendSure, headquartered in San Diego, was founded by former executive managers from Accredited Home Lenders, a prominent subprime lender before the financial crisis ...