Bridge loans, or fix-and-flip loans, have only recently entered the RMBS market. But here’s a breakdown on the threat they pose homeowners and investors according to a major crediting agency.
Read More »What’s Driving Default Risk?
Despite a strong economy a new study reported an increase in default risk in Q3. What factors are driving these increases?
Read More »Risk of Default Jumps in Q1, Q2
Overall default risk is up, according to an index released on Tuesday. Up 25 points over fall 2016’s numbers, risk of default is rising that’s to higher mortgage rates and tightening monetary conditions. The risk will likely continue its upward climb too, especially if the Federal Reserve raises rates again—as expected—later on in the year. According to the report, investors and lenders can expect today’s loans to hold a 6 percent higher risk of default than loans of the 1990s.
Read More »Risk of Default is Rising for New Mortgages
For newly originated mortgages, default risk is on the rise. What is the takeaway for investors and lenders?
Read More »Mortgage Credit Access Reverses Course
Credit availability in the mortgage industry increased slightly in the fourth quarter, reversing a long-time downward trend over the last four quarters.
Read More »Are Legacy HELOC Borrowers at Significant Risk of Default?
Some in the industry have expressed concern that a large number of borrowers with legacy HELOCs will default because they cannot handle the payment shock that awaits them when they reach their end-of-draw period. How are they handling it so far?
Read More »Home Purchase Loans Are Becoming Less Risky
The risk of default is greater in some channels than in others.
Read More »Shift from Bank to Nonbank Lending Causing Rise in Default Risk for Agency-Backed Loans
The across-the-board increases in default risk can be attributed to the risk associated with nonbank lending, which is substantially higher than that of big bank loans, according to AEI. The composite NRMI was reported to be 11.93 percent in February, a slight increase of 0.1 percentage points from the prior three-month average and a jump of 0.8 percentage points year-over-year. The composite index just hit a series high of 11.94 percent in January.
Read More »JPMorgan Wary of FHA Business
In a conference call with analysts following the release of its second quarter earnings report Tuesday, JPMorgan CEO Jamie Dimon took the time to single out Federal Housing Administration (FHA) backed lending as a source of risk for the Megabank.
Read More »Fitch: Slow RMBS Prepayments Lengthens Default Term Risk
A new report from Fitch Ratings found that U.S. prime jumbo residential mortgage-backed securities (RMBS) issued since the start of 2010 are unlikely to see a "meaningful increase in prepayments, even if interest rates stay low." The company believes that the lack of prepayments will result in an increased average life of the mortgages in these trusts, further increasing the period of default risk.
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