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Tag Archives: RMBS

Hurricane Sandy’s Impact on RMBS May Be Smaller than Expected

While the lives of those affected by Hurricane Sandy may not return to normal for some time, one research report suggests the storm’s impact on non-agency residential mortgage-backed securities (RMBS) may be much less substantial than originally anticipated. With some estimates as high as $88 billion, Opera Solutions released its own estimate based on neighborhood-level data Friday. The firm suggests the damage will be closer to $6 billion.

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Freddie’s 2013 Buyback Strategy: Older Loans for QC but Fewer Reviews

Freddie Mac is ramping up repurchase demands and increasing the pool of defaulted loans subject to put-backs to include mortgages originated prior to the crisis in 2004 and 2005, according to U.S. Bancorp CEO Richard Davis. Speaking to investors at the Goldman Sachs Financial Services Conference this week, Davis described the news as ""unexpected,"" but Freddie Mac maintains it has always had the authority to pull files for review when loans stop performing regardless of when the loans were originated. The GSE says its repurchase policies have not changed and it is committed to working with lenders to resolve any issues.

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SEC Ends Probe of Wells Fargo

The Securities and Exchange Commission (SEC) has ended its investigation of potential fraud in offering documents for mortgage-backed securities (MBS) sold by Wells Fargo, Bloomberg reports. The biggest home lender in the country announced in a regulatory filing that the SEC notified the bank on November 20 that the agency was ending its probe without enforcement.

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Freddie Mac’s Serious Delinquency Rate Slips to Three-Year Low

Freddie Mac's single-family seriously delinquent rate decreased from 3.37 percent in September to 3.31 percent in October--the lowest it's been since August 2009. The GSE's multifamily delinquency rate also fell, from 0.27 percent in September to 0.24 percent for the month of October. At the same time, Freddie Mac's total mortgage portfolio continued to shrink, however increased purchase and issuance volume pushed the company closer to positive growth for the first time in more than a year and a half.

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Ocwen, Walter Investment Receive Court Approval for ResCap Bid

Ocwen Loan Servicing, LLC and Walter Investment Management Corp. announced the U.S. Bankruptcy Court for the Southern District of New York approved their bid for Residential Capital, LLC (ResCap). In October, Ocwen and Walter Investment won a bid priced at $3 billion for ResCap’s mortgage servicing and originations businesses. The transaction is expected to close in the first quarter of 2013, according to the announcements.

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New York AG Targets Credit Suisse in Second RMBS Task Force Suit

New York Attorney General Eric Schneiderman announced a complaint was filed Tuesday against Credit Suisse Securities (USA) LLC and its affiliates for allegedly misrepresenting residential mortgage-backed securities (RMBS) sold to investors. The complaint is the result of investigations carried out by the RMBS Working Group. The investigations were based on practices from 2006 to 2007, and the group alleges Credit Suisse issued $93.8 billion in RMBS during that time. By mid-2012, losses from those securities reached over $11.2 billion, or 12 percent of the total.

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JPMorgan, Credit Suisse Settle RMBS Charges for $416.9M

JPMorgan Securities LLC and Credit Suisse Securities (USA) paid a combined $416.9 million to settle charges of misleading investors in the sale of residential mortgage-backed securities (RMBS), the Securities and Exchange Commission (SEC) announced. According to the SEC's complaint against JPMorgan, the bank misstated information about the delinquency status of mortgages that provided collateral for an RMBS offering it underwrote. JPMorgan received fees of more than $2.7 million, and investors sustained losses of at least $37 million on undisclosed delinquent loans, the SEC says.

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Fannie Mae Expects First Net Annual Profit in Six Years

Fannie Mae has experienced significant improvements in recent months. The GSE reported a $1.8 billion net income for the third quarter of this year, a notable improvement over the $5.1 billion loss reported in the same quarter last year. Fannie Mae's third quarter report states the entity will not require a draw from Treasury this quarter. Fannie Mae also incurred a net income of $9.7 billion over the first three quarters of this year, leading the GSE to expect an annual net income for the first time since 2006.

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Judge Disagrees with JPMorgan’s Argument to Dismiss FHFA MBS Suit

A U.S. district judge squashed an attempt by JPMorgan Chase to fully dismiss a lawsuit from the Federal Housing Finance Agency over alleged fraud over mortgage-backed securities. In its motion to dismiss, JPMorgan argues that FHFA's complaint does not contain enough factual support that loans were not underwritten properly. Judge Denise Cote disagreed, saying the allegations ""amply support FHFA's assertion that the Offering Documents for the Securitizations contained false statements regarding originators' compliance with underwriting standards.""

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Fitch: Impact of Sandy on RMBS

If Hurricane Sandy has any impact on the performance of residential mortgage-backed securities (RMBS), it will probably be one that is short-term, according to Fitch Ratings. The global rating agency says a ""modest and temporary increase in mortgage delinquency could occur"" after assessing the potential impact of the storm that has devastated areas in the Mid-Atlantic and Northeast coast.

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