Secondary markets

A company that has been helping to mitigate strategic default risk with borrower incentives for on-time payments, now is more broadly offering to help clients mitigate certain second-lien loan balance sheet concerns through rewards for accelerated pay-downs.

The Prestwick Mortgage Group is offering investors a GSE 'flow' servicing arrangement that could be as large as $720 million per year in MSRs.

A federal judge has indicated he plans to reject Goldman Sachs & Co.'s motion to dismiss NCUA's suit and continue the case challenging the Wall Street bank over $1.1 billion of faulty residential mortgage-backed securities it sold to U.S. Central FCU and WesCorp FCU, the two biggest credit union failures ever.

In case you haven't been paying close attention and reading the National Mortgage News website (and our paper weekly) the past year, there's a gargantuan shift underway in the mortgage industry. We correctly predicted that the servicing side of the business is 'deconsolidating.'

Chimera Investment Corp., a publicly traded REIT that invests in MBS, said in a new SEC filing that it has fired its accounting firm, Deloitte & Touche LLP.

The rate-indicative 10-year Treasury yield as of Friday just before noon had continued its upward movement to a point notably higher than the range it had been in previously, but hedged players in the industry so far appear to be weathering the move relatively well.

Farmer Mac earned $13.3 million for the fourth quarter and $13.8 million for the full year 2011, as the company saw increased net interest income and it was able to release funds from its allowances for loan losses.

It's known as the 'Oops' loan market - where Fannie Mae/Freddie Mac lenders get jammed on a buyback request not because the loan is delinquent, but because one of the GSEs finds an underwriting flaw and demands a repurchase or damages. The seller/servicer then takes that loan and resells it to another buyer.

With the overseers of Fannie Mae and Freddie Mac digging in their heels against the use of principal write-downs for troubled homeowners, Senate Democrats pressed their case for a course change on Thursday.

Mortgage bankers funded roughly $41 billion of jumbo loans in the fourth quarter, a 28% increase from the same period a year earlier, according to exclusive survey figures compiled by National Mortgage News and the Quarterly Data Report.

Management at Ally Financial Corp. is considering throwing part of its mortgage division into bankruptcy and then executing a sale of most of its "good" assets, investment banking sources said late Thursday.

The Mortgage Bankers Association is willing to back a GSE-related refinancing bill introduced by Sen. Al Franken, D., Minn., but wants assurances that the industry will no longer be hit with buyback requests on loans that are several years old.

For the second time in less than a year, Colony Financial Inc., Los Angeles, has raised fresh capital through a stock offering.

It is better to address the future of the GSEs now rather than wait for stability in the market because if it is done at that time, it would reintroduce instability, Fannie Mae chief economist Doug Duncan told the Regional Conference of the Mortgage Bankers Associations in Atlantic City.

Beginning July 16, Fannie Mae, Freddie Mac and the Federal Home Loan Banks will no longer be allowed to deal in mortgages on properties encumbered by private transfer fee covenants that do not benefit the property.

The great land rush to riches in the jumbo securitization market appears to have hit a brick wall.

Credit union executives urged Congress this morning to step in and alleviate a rapidly growing list of new regulations affecting credit unions and banks.

The apartment market is recovering nicely and Fannie Mae and Freddie Mac are enjoying the ride.

The Securities and Exchange Commission Tuesday sued the former top executives of now defunct 'super' jumbo lender Thornburg Mortgage, accusing the trio of hiding the firm's deteriorating financial condition and overstating income by $400 million.

Prior to the crackup of the housing market, most warehouse providers were ready, willing and able to extend credit to nonbank lending customers based on the value of their retained servicing rights. But then came the crash.