The non-agency MBS market in early 2006 is running ahead of the pace set last year, thanks to continuing strength in subprime and Alt A deals plus a surge in second mortgage securitization. A total of $285.13 billion of non-agency MBS were issued during the first quarter of 2006, according to a new ranking and analysis based on the Inside Mortgage Finance MBS Database. The first quarter issuance was up a solid 17.7 percent from… {Three data tables included]
Read More
A massive new disclosure regime for issuers of non-agency MBS and other asset-backed securities is on the books, and firms are supposed to be well on their way to complying. But a number of unresolved issues continue to plague the so-called Reg. AB – and the Securities and Exchange Commission doesn’t seem to be in much of a mood to cut anyone slack. …
Read More
A move by subprime MBS issuers to mix a broader range of credit scores within a single security is prompting investors to take a closer look at the loans they are buying. The emergence of what are being called “barbell” subprime MBS transactions was one of the emerging trends discussed at last week’s Housing Finance Summit put on by the Opal Financial Group in Miami. …
Read More
Fixed-rate mortgages with interest-only features do not necessarily prepay faster than normally amortizing loans, and the differences in the IO prepayment speeds may be due to other factors, according to a new analysis by RBS Greenwich Capital. In the report, “Fixed-Rate IO Loan Prepayments,” RBS Greenwich analysts tried to see whether or not the IO component alone influenced prepayment speeds. The report found that loan size, geography, and FICO score can explain why fixed-rate…
Read More
Standard & Poor’s will require higher credit support for mortgage pools with simultaneous second liens, also known as silent seconds or piggyback loans. The rating agency announced the requirement for additional credit enhancements after revising its criteria for residential mortgages with piggyback loans. The latest enhancements will provide an additional cushion against increased default risk on mortgages with piggyback seconds in various FICO buckets. …
Read More
Many mortgage finance experts agree that there is an Alt B segment in the market somewhere near the intersection of low documentation and near-prime borrower credit, but few admit to actually doing business there. Maureen Bolton, a senior vice president and manager of international finance at HSBC US, said the Alt B market has had a noticeable impact on the Alt A market. “People don’t want to use the Alt B phrase, which is why…
Read More
Credit unions are a depository nightmare for commercial banks and thrifts, which rail against their preferential tax treatment and increasingly lax membership requirements. But one market in which credit unions pose no challenge at all is their investment in mortgage securities. Federally insured credit unions held just $24.01 billion of mortgage securities in portfolio as of the end of last year, according to data from the National Credit Union Administration. That was down 15.0 percent… [One data table included]
Read More