ASF Supports GSE Single Platform but Concerned About PLS Component

The American Securitization Forum has formally issued a comment letter supportive of a single securitization platform for GSE MBS, but has concerns when it comes to extending it to support the private-label market.

“We’re supportive of them in aligning what they do externally and internally,” Tom Deutsch, executive director, American Securitization Forum, told National Mortgage News. “Where we get concerned is where there are inferences that private markets could use [the same platform].”

One potential concern is differences between representation and warranty mechanisms in agency and private-label markets that would make standardization difficult.

“Reps and warrants” in agency transactions—and the parties that make them—are more standard than those in the relatively more complex PLS market, Deutsch noted in one of the industry comment letters submitted on the single platform plan.

While the ASF has been advocating for increased efficiencies and best practices in the PLS market where possible, “there are simply too many moving parts for a ‘one size fits all’ set of disclosure and operative documents to be effective,” he said in a letter submitted to the Federal Housing Finance Agency.