Implementation of the second phase of the common securitization platform had been projected for next year, but the anticipated time frame was delayed following "lessons learned" from the first phase.
The two credit insurance risk transfer transactions are each linked to a pool of 30-year, fixed-rate mortgages that the government-sponsored agency acquired from January through July 2016.
Servicing practices that unnecessarily increase what a borrower owes can contribute to delinquencies. But other misconduct, such as inaccurate credit reporting, can have more insidious effects on a borrowers financial health.
Like the sponsor's last several deals, the loans are secured by properties with very low values, which tend to experience higher loss severities when borrowers default (or redefault), according to Fitch Ratings.
A $165 million cash settlement has been reached in a class-action lawsuit that alleged investors were misled about bonds backed by loans originated by now-defunct subprime lender NovaStar Mortgage Inc.
Regulation AB governs registration, reporting and disclosure requirements for all things asset-backed. The Securities and Exchange Commission appears to be ready to update it significantly, but, nearly four years after changes were originally proposed, its not clear exactly what the Commission will do.
Concern is mounting among investors and analysts that Nationstar, Ocwen Financial and Walter Investment are getting so big so quickly that they are becoming too difficult to manage.
The proposal would introduce dissemination of trade prices for securities ranging from highly liquid credit card and auto ABS to smaller and more esoteric deals in asset classes such as time shares, to commercial mortgage-backed securities (CMBS) and highly structured CDOs and collateralized loan obligations.
Overall issuance growth will moderate in 2014, Fitch Ratings' managing director for asset backed securities says in the firm's outlook.
The servicer has a reputation for aggressively writing down principal, often multiple times.
Treasurer, Head of Asset Management
Firm: NewStar Financial
Owning may offer consumers more savings than leasing, but loans pose a different set of risks to investors when pooled into collateral for bonds.Current Issue