Tag Archives: RMBS

Federal Reserve Chairman Ben Bernanke said at a press conference Wednesday that ""ongoing drags from troubled housing conditions and still tight credit"" have led Fed officials to downgrade their forecasts for short-term economic growth. Bernanke quite frankly told reporters that problems in the housing sector are a big reason why our economy is not recovering more quickly. Despite the diminished outlook and Bernanke's repeated references to the depressed housing market, the Federal Reserve announced no new policy actions.

Rep. Scott Garrett, chairman of the House subcommittee responsible for matters related to the nation's two largest mortgage financiers, says Fannie Mae and Freddie Mac are not only systemically dangerous to economic security, but their government-sanctioned structure is ""un-American."" Garrett has unveiled his plan for putting housing finance reform on the fast track by ensuring private investors are ready to take up the slack from the GSEs. The sheer dominance of the two companies, however, leads some in the industry to err on the side of caution.

Clayton Holdings announced the formation of a new securitization group dedicated to helping the private market prepare for the return of non-agency residential mortgage-backed securities (RMBS). Clayton Holdings provides customized risk analysis, loss mitigation, operational solutions, and staffing services to the mortgage and fixed income industries. The firm's new securitization group will offer consultative services, as well as loan reviews and due diligence services in readying the secondary market for greater private sector involvement.

Investors opposed to the $8.5 billion settlement reached between Bank of America and securities trustee Bank of New York Mellon will get their day in federal court. The settlement was originally filed in New York state court. A band of dissenting investors going by the name of Walnut Place moved the action to federal court, and BNY Mellon has been pushing for the case to revert back to the state. U.S. District Judge William Pauley denied BNY Mellon's motion this week.

CoreLogic and Amherst Holdings, LLC, have partnered to release the Agency Prepayment Analyzer, an online investment analysis tool. The analyzer intertwines CoreLogic's data with Amherst's analytics and forecasting to deliver prepayment risk trends for agency mortgage-backed securities. Designed for fixed-income investors, Agency Prepayment Analyzer tracks the rates at which residential mortgage loans prepay, either voluntarily or involuntarily due to refinancing, defaults, or sales - instances in which the GSEs require buybacks.

The administration is looking into ways to support greater private sector involvement in the secondary market for home mortgages. Officials are weighing a proposal that would allow Fannie Mae and Freddie Mac to sell off portions of their mortgage-backed securities (MBS) to private investors. These MBS carve-outs would not carry a federal guarantee but would pay a higher interest rate. A pilot program could be rolled out as early as next year to test private investors' willingness to share some of the risk carried by the GSEs.

Rekon Technologies has installed the latest edition of its namesake software for one of the top three mortgage lenders in the nation. The company provides software solutions to loan servicers and lenders that prepare, record, manage, and track loan documents, such as assignments, lien releases, and UCC terminations. The latest version of the Rekon software is designed to reduce assignment backlogs and ensure clean titles for foreclosure proceedings.

The Federal Housing Finance Agency (FHFA) has signed off on several headline-grabbing arrangements between major lenders and the GSEs to reconcile loan repurchase claims. The results of an investigation released this week, however, indicate approval was made in haste. In response, FHFA has put the brakes on any future repurchase settlements pending further examination of the process in place to assess the true cost of such deals for taxpayer-funded Fannie Mae and Freddie Mac.

Residential mortgage-backed securities investor Two Harbors Investment Corp. has announced the appointment of its controller Brad Farrell to the position of CFO and treasurer, effective January 1, 2012. After that time, Two Harbors' current CFO, Jeffrey Stolt, will continue to serve as partner and CFO of Pine River Capital Management L.P., the parent of PRCM Advisers LLC, Two Harbors' external manager.

The nation's foremost securities regulator is considering a civil injunction against Standard & Poor's (S&P) for its rating of a collateralized debt obligation (CDO) linked to high-risk mortgages. S&P's parent company told investors Monday it received notice that the Securities and Exchange Commission (SEC) may proceed with enforcement actions and monetary penalties. At the center of the investigation is a $1.6 billion CDO from 2007, which has been cited as an example of why the financial crisis ran so deep.