Ocwen Financial Corp.'s loan servicing subsidiary has reached a settlement with the Washington State Department of Financial Institutions' consumer services division over the servicer's practice of using unlicensed offshore companies.
Many lenders are still reluctant to give mortgages to borrowers with less-than-pristine credit, yet such loans are far more likely than prime jumbo loans to be bundled into collateral bonds. Sreeni Prabhu of Angel Oak Capital credits banks' behavior and higher interest rates for that reality.
Despite headwinds working against the mortgage insurance industry, this business could be the catalyst for bringing private capital back to the mortgage market.
Angel Oak Capitals second securitization of non-prime residential mortgages brought its funding costs down significantly, helped by the addition of some new investors.
The deal is backed by a portfolio of 1,410 single-family rentals, 1,343 of which are leased to tenants who have the right to purchase the leased property at a premium during the term of the lease: Moody's sees this as a credit positive.
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
State student loan authorities sense a business opportunity helping graduates who are gainfully employed lower their payments. Their low-cost funding could put them in competition with banks and marketplace lenders.Current Issue