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Analysis: Loan Mod Program Re-Boot |
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Written by Paul Jacob
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Tuesday, 30 March 2010 13:50 |
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Summary On Friday the administration announced several changes to its basket of homeowner assistance programs. Although this development generated loud headlines, we think the actual impact will be subtle and, if the history of borrower initiatives of the past three years is a guide, disappointing. In our view, the most important change is the imposition of mandatory new “outreach” steps in foreclosure proceedings. This will almost surely have the effect of further slowing foreclosure timelines that are starting to be measured in years, rather than months. Over time, the new pre-foreclosure requirements may push servicers into performing more short sales. While the other changes will improve or expand homeowner assistance at the margins, we believe the effects will not be significant. Bear in mind that with all these assistance programs, you’ve been paid to “bet the unders” in actual volume to date. Also in this report, we review the latest OCC-OTS figures on loan mod composition and redefault performance. Though redefault performance overall remains extremely poor, there are signs of hope in the subset of more recent mods that involve significant cuts in monthly payments. |
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Last Updated on Wednesday, 31 March 2010 08:35 |
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Analysis: Option ARM Update |
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Written by Paul Jacob
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Monday, 01 March 2010 10:55 |
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The Pay-Option ARM sector continues to be at the intersection of all the troubling trends in residential mortgage credit: rising total delinquencies; a substantial backlog of troubled loans without resolution; severely underwater borrowers; concentrated geographic exposure to boom-and-bust areas. Risk / reward in this sector going forward will largely be driven by three factors: (1) when and how the backlog of troubled loans is cleaned up; and (2) whether new delinquencies deteriorate further (from strategic defaults and unemployment) or improve (from credit burnout); and (3) whether loss severities can remain stable despite the enormous number of homes facing liquidation and the troubling age of delinquencies. |
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Last Updated on Monday, 01 March 2010 14:36 |
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HAMP FAQs, Released 10/28/09 |
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Written by Other (See Below)
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Friday, 30 October 2009 07:08 |
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These frequently asked questions clarify the Supplemental Directives issued in connection with the Home Affordable Modification Program (HAMP). The questions and answers below should be reviewed by each servicer that has entered into a Servicer Participation Agreement (SPA) to participate in the HAMP. |
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Last Updated on Friday, 30 October 2009 07:14 |
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The Complex New World of RMBS Shortfalls |
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Written by Other (See Below)
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Friday, 29 January 2010 08:42 |
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by Matthew Tomiak and William Berliner Originally published in American Securitization Journal, Winter/Spring 2010 How to restructure the overwhelming number of troubled loans backing mortgage bonds remains one of the major challenges of the credit crisis. It’s not just that virtually no private-label residential mortgage-backed securities (RMBS) were structured with subordination levels sufficient to absorb current losses on their loan collateral, making even senior and super-senior securities subject to potential downgrades and writedowns. |
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Last Updated on Friday, 29 January 2010 08:48 |
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Why Servicers Foreclose When They Should Modify and Other Puzzles of Servicer Behavior |
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Written by Other (See Below)
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Wednesday, 21 October 2009 15:27 |
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by Diane E. Tompson, National Consumer Law Center (c) National Consumer Law Center. All rights reserved. The country is in the midst of a foreclosure crisis of unprecedented proportions. Millions of families have lost their homes and millions more are expected to lose their homes in the next few years. With home values plummeting and layoffs common, homeowners are crumbling under the weight of mortgages that were often only marginally affordable when made. One commonsense solution to the foreclosure crisis is to modify the loan terms. Lenders routinely lament their losses in foreclosure. Foreclosures cost everyone—the homeowner, the lender, the community—money. Yet foreclosures continue to outstrip loan modifications. Why? |
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Last Updated on Wednesday, 21 October 2009 15:33 |
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