Many Issuers Hoping to Securitize This Year

Several influential issuers are hoping to bring a new-issue residential mortgage securitization to market this year, according to one executive attending the American Securitization Forum conference. "Every major issuer we've spoken to has a goal of doing a deal this year [and] with one or two exceptions, they are all looking at a prime [jumbo] deal," said Alex Santos, president of predictive analytics and advisory firm Digital Risk LLC, Maitland, Fla. In regard to timing, he added that, "The most ambitious goal I have heard is the first quarter." While pricing remains an obstacle, discussions about the possibility have become more serious, said Mr. Santos, whose firm's offerings include contract underwriting. Among the reasons why is that "they hear the loans are better than they were," he said. But Digital Risk has some mixed findings when it comes to whether loans really have improved. Credit quality, as far as loan-to-value and debt-to-income ratios, is better, Mr. Santos said. But when it comes to cutting down on procedural mistakes, underwriting "hasn't improved as much as people expect and hope," he said.