Secondary Market

A new white paper has proposed a detailed plan for reforming the nation’s GSEs. Offering a roadmap toward reform, the paper also outlines how to handle the transition to a new GSE system, as well as the secondary markets role in the move. The paper is designed to help legislators move GSE reform along—a goal the new administration has made clear.

A new report by Trulia says the Consumer Financial Protection Bureau has proven a powerful ally to borrowers across the economic spectrum. It’s also proven a valuable resource for military service members and older Americans. And taking it away could be more trouble than its worth.

The number of prime jumbo RMBS transactions has doubled year-over-year, according to a new report. Six new transactions were completed in Q1 2017, totaling $2.6 billion. Only 29 out of about 50,000 loans are currently delinquent.

mortgage default rates are up one basis point from February to .75 percent, a one-year high. Year-over-year, the mortgage default rate dropped from .77 percent, while the bank card default rate increased year over year. Of the five major cities covered by the S&P/Experian Consumer Credit Default Indices (New York, Chicago, Dallas, Los Angeles, and Miami), New York and Chicago posted month-over-month increases in the Index level, while Dallas, Los Angeles, and Miami posted month-over-month decreases in defaults.

A new index shows the GSEs are expanding their credit boxes and taking more risk, making it easier for consumers to get a mortgage loan. Government, portfolio, and private-label security channels are not expanding the box, however, and are actually decreasing the amount of risk they take in lending. Though overall mortgage credit availability is largely stable, there is still much room to expand the credit box—particularly in these more stringent markets.

A recent report revealed that the nation’s top grossing single-family rental markets are mostly noncoastal, Midwestern states, with Cleveland, Ohio, taking the top spot. At No. 2 and 3 were Detroit and Dayton, Ohio, respectively. Memphis and Toledo rounded out the top five.

Morgan Stanley has now completed 77 percent of its consumer relief obligations per its legal settlement with the State of New York. With the recent approval of nearly $200 million in credit, the organization has now satisfied $309.1 million or the total $400 million it owes. The settlement stems from a 2016 case regarding residential mortgage-backed securities.

A New York federal judge said that Wells Fargo must face litigation seeking to hold the bank accountable for billions of dollars in claimed investor losses as trustee of residential mortgage-backed securities, saying the investor funds more than met the pleading the standard. The plaintiffs, including BlackRock Inc, Pacific Investment Management Co, Prudential Financial Inc, and TIAA-CREF, can pursue breach of contract and conflict of interest claims related to 53 trusts, said U.S. District Judge Katherine Polk Failla.

Fannie Mae recently released its Monthly Summary for February 2017. Fannie Mae’s gross mortgage portfolio decreased for at a compound annualized rate of 16.9 percent for the month, while the GSEs Conventional Single Family Delinquency Rate stayed much the same month-over-month.

The GSE no longer allows plywood to be used on homes in preforeclosure, however, this rule does not apply to Fannie Mae’s REO properties. As of March 29, servicers have 90 days to re-glaze/repair or clear board all unsecured and previously plywood boarded windows. Additionally, Fannie Mae will allow servicers seven days to secure a property after it has been found vacant, by re-glazing/repairing or clear boarding.