ARMs tripled at banks over past decade
Growth in conventional originations at U.S. banks came with the unexpectedly rapid rise of 30-year fixed interest rates in 2022, Federal Reserve researchers found.
ARMs
Adjustable rate mortgage production is flourishing
The loans accounted for 18.6% of conventional single-family dollar volume in April, quadrupling its share of business at the peak of the refinance boom, according to Corelogic.
ARM borrowers today more financially fit than average buyer: Zillow
Consumers taking out adjustable-rate mortgages last year put down a median down payment of 23.6%, researchers at the real estate brokerage found.
MBA creates servicer notifications for Libor’s discontinuation
The modifiable templates are a follow-up to a similar notification the organization created in 2019 for lender use.
Mortgage credit rises as more lower score loan products offered
Lenders also increased jumbo product availability as well as rolling out new SOFR-indexed ARMs.
Weak contract language could lead to post-Libor ARM securities losses
Bondholders could see principal losses if, due to the way the documents are worded, the rate is frozen at the last published amount.
Mortgage credit rises in July, as ARMs, jumbos come back
Conditions have improved for the first time since November.
CFPB proposes rule to facilitate Libor transition for creditors
The Consumer Financial Protection Bureau seeks to address challenged posed by the sunset of the London interbank offered rate at the end of 2021.
GSEs issue Libor-to-SOFR transition playbook
Fannie Mae and Freddie Mac have different timelines for the switch.
Libor transition hits hurdle as SOFR-linked bond sales slump
The biggest issuers of bonds tied to the benchmark tapped to replace U.S. dollar Libor are suddenly pulling back, a potential blow to efforts by regulators to wean the financial system off a much-maligned reference rate.
RMBS trustees worry that consent process will slow down Libor switch
Trustees are concerned about obtaining proper consents from legacy residential mortgage-backed securities investors in a timely fashion in order to make the switch from Libor to another index, Fitch Ratings said.
Ellington launches new large-loan RMBS in $226M deal
The pool of 497 loans includes first-lien fixed- and adjustable-rate mortgages for single-family homes and multifamily properties, primarily underwritten to self-employed borrowers.
By
Glen Fest
MBA creates Libor discontinuation notice for residential lenders
The Mortgage Bankers Association created a template for originators to notify new borrowers when their adjustable-rate mortgage switches to a different index once publication of the London interbank offered rate discontinues.
‘Devil is in the details’ for lenders transitioning from Libor: MBA
Commercial and multifamily mortgage lenders need to figure out their plan for replacing the London interbank offered rate index potentially expiring at the end of 2021.
Switch to SOFR term rate could cost RMBS investors
The Urban Institute's conclusion is based on estimates that one-year SOFR rates could be 25 to 50 basis points lower than the current Libor equivalent.
By
Glen Fest
Fannie Mae helps the market take another step away from Libor
Fannie Mae has priced more securities that support a transition away from the London interbank offered rate.
Fannie Mae issues securities to support Libor alternative
Fannie Mae has issued securities supporting the transition away from the London interbank offered rate; something that could become more pressing for lenders if adjustable-rate mortgages were to become more prevalent.
MountainView brokering $3.5B in Fannie and Freddie MSRs
MountainView is brokering a nonrecourse $3.5 billion package of Fannie Mae and Freddie Mac mortgage servicing rights on behalf of an unnamed seller.
Loans ‘ignored’ in Libor talks — so far
A Fed committee studying Libor’s replacement has dwelled heavily on the potential impact to the derivatives market. Loans may become a bigger part of the conversation later this year, but the panel plans to leave a lot of the specifics up to lenders.
By
Andy Peters
