Archive for the ‘HMBS’ Category

$55 Billion Speed Limit Slows HMBS Market Growth

Sunday, September 17th, 2017

The HMBS market remained stuck at $55 billion in August. HMBS Prepayments topped $1 billion, but was balanced by 92 new pools totaling over $913 million. In its second month of issuance, Longbridge Financial led all issuers with nine pools totaling $215 million.

August issuance divided into 52 original pools and 40 tail pools. No seasoned original new loan pools were issued. Production of original new loan pools was a healthy $736 million, the highest total since last August, and up from $622 million last month.

Original pools are those HMBS pools backed by first participations in previously uncertificated HECM loans. Tail HMBS issuances are HMBS pools consisting of subsequent participations. In other words, tail pools are created from the Uncertificated Portions of HECMs that have already had their original HMBS issuance. July’s tail issuance was about $177 million.

Last month, total outstanding HMBS grew by $43 million from July. We estimate that last month’s change in HMBS balance was composed of over $188 million in negative amortization (a record), plus the $914 million in new issuance, minus $1.06 billion in payoffs. Last month’s payoffs were the third highest ever; payoffs have exceeded new issuance for twelve months in a row.

Payoff figures are still high as more seasoned HECM loans liquidate or reach 98% of their Maximum Claim Amount (“MCA”). Our friends at RecursionCo once again crunched the numbers: the payoffs from 98% MCA puts totaled approximately $590 million last month. According to Recursion, the 98% MCA puts were only $92 million, or 29.8% of payoffs in September 2013. This probably means further shrinkage in HMBS float throughout 2017.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.

HMBS Shrinkage Takes Summer Vacation; Issuer Beach Getting Crowded

Monday, August 14th, 2017

The HMBS market grew in July, featuring a new issuer and lower prepayments. HMBS prepayments fell below $1 billion as thirteen issuers created 109 pools in July totaling over $848 million. Longbridge Financial made its HMBS issuance debut with two pools totaling $54 million.

July issuance divided into 46 original pools and 63 tail pools. No seasoned original new loan pools were issued. Production of original new loan pools was a healthy $622 million, up from $571 million in the prior month.

Original pools are those HMBS pools backed by first participations in previously uncertificated HECM loans. Tail HMBS issuances are HMBS pools consisting of subsequent participations. In other words, tail pools are created from the Uncertificated Portions of HECMs that have already had their original HMBS issuance. July’s tail issuance was about $225 million, the highest total since January.

Last month, total outstanding HMBS grew by $63 million from June. We estimate that July’s change in HMBS balance was composed of over $186 million in negative amortization (a record), plus the $848 million in new issuance, minus $971 million in payoffs. July’s payoffs were the third highest ever; payoffs have exceeded new issuance for eleven months in a row.

Payoff figures are still high as more seasoned HECM loans liquidate or reach 98% of their Maximum Claim Amount (“MCA”). Our friends at RecursonCo once again crunched the numbers: the payoffs from 98% MCA puts totaled approximately $576 million last month. This amount is down from last month but the overall trend has been a steady rise. According to Recursion, the 98% MCA puts were only $92 million, or 29.8% of payoffs in September 2013. This probably means further shrinkage in HMBS float throughout 2017.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.

HMBS Blooms but June Swoon Lowers Boom: Payoffs Zoom as Shrinkage Looms

Thursday, July 13th, 2017

The HMBS market shrank again in June, with another huge prepayment wave outweighing a strong month of new issuance. Nearly 2% of outstanding HMBS supply paid off as HMBS prepayments exceeded $1 billion for the second month in a row. Issuers created 101 pools in June totaling over $779 million. June issuance divided into 50 original pools and 51 tail pools. No seasoned original new loan pools were issued. Production of original new loan pools was a healthy $571 million, up from $543 million in the prior month.

Original pools are those HMBS pools backed by first participations in previously uncertificated HECM loans. Tail HMBS issuances are HMBS pools consisting of subsequent participations. In other words, tail pools are created from the Uncertificated Portions of HECMs that have already had their original HMBS issuance. June’s tail issuance was about $208 million, also consistent with recent production.

Last month, total outstanding HMBS shrank by a record $111 million from May. We estimate that last month’s change in HMBS balance was composed of over $181 million in negative amortization (a record), plus the $779 million in new issuance, minus the record $1.07 billion in payoffs. Payoffs have exceeded new issuance for ten months in a row.

Payoffs continue to climb as more seasoned HECM loans liquidate or reach 98% of their Maximum Claim Amount (“MCA”). Our friends at RecursionCo once again crunched the numbers: payoffs from 98% MCA assignments totaled a record of approximately $640 million last month. This amount has been rising steadily. According to Recursion, the 98% MCA puts were only $92 million, or 29.8% of payoffs in September 2013. This probably means further shrinkage in HMBS float throughout 2017.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.

HMBS Issuer Rankings 2017 First Half – AAG Widens Its Lead

Thursday, July 6th, 2017

AAG remains the leading HMBS Issuer for the first half of 2017, issuing $1.132 billion of securities for a 24.4% market share, increasing by 0.42% from the first quarter its margin over #2 Finance America Reverse’s $810.7 million and 17.4% market share. Reverse Mortgage Funding remained in third for the half with $758.7 million issued and 16.3% market share. Ocwen Loan Servicing and Live Well Financial round out the top five issuers. Ocwen issued $664.4 million for a 14.3% market share, and Live Well was fifth with $428.6 million issued for a 9.2% market share. Nationstar dropped to 6th place for the half. The top five issuers accounted for 81.6% of all issuance, up from last quarter’s 79.6%. There were 15 HMBS issuers in the first half of 2017, tying the high water mark for number of issuers set in 2016.

Despite the much-reported slowdown in HECM endorsements, HMBS issuance remains robust, aided by growth in tail issuance and without highly seasoned pools. Issuance volume totaled $4.649 billion for the first half of 2017, on pace to pass 2016’s full year production of $9.187 billion. 2010 was the record year for HMBS with $10.7 billion of securities issued.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.

May Prepayments Shrink HMBS Again – Prepayments May Again Shrink HMBS

Thursday, June 15th, 2017

The HMBS market shrank again in May, with a huge prepayment wave outweighing an otherwise strong month of new issuance. Nearly 2% of outstanding HMBS supply paid off as HMBS prepayments exceeded $1 billion for the first time. Issuers created 111 pools in May totaling over $768 million. April issuance divided into 48 original pools and 63 tail pools. No seasoned original new loan pools were issued. Production of original new loan pools was a healthy $543 million, consistent with recent production.

Original pools are those HMBS pools backed by first participations in previously uncertificated HECM loans. Tail HMBS issuances are HMBS pools consisting of subsequent participations. In other words, tail pools are created from the Uncertificated Portions of HECMs that have already had their original HMBS issuance. May’s tail issuance was about $225 million, also consistent with recent production.

Last month, total outstanding HMBS shrank by a record $72 million from April to approximately $55.1 billion. We estimate last month’s change in HMBS balance was composed of approximately $181 million in negative amortization (a record), plus the $768 million in new issuance, minus the record $1.02 billion in payoffs. Payoffs have now exceeded new issuance for nine months in a row.

Payoffs figure to continue their climb as more seasoned HECM loans liquidate or reach 98% of their Maximum Claim Amount (“MCA”). Our friends at RecursionCo once again crunched the numbers: the payoffs from 98% MCA assignments totaled a record $580 million last month, 56.9% of payoffs. This amount has been rising steadily. According to Recursion, the 98% MCA puts were only $92 million, or 29.8% of payoffs in September 2013. This probably means further shrinkage in HMBS float throughout 2017.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.

HMBS April 2017: Original Supply Blooms in Spring

Wednesday, May 10th, 2017

The HMBS market remained in supply equilibrium again in April, with high prepayment numbers balanced out by a strong month of new issuance. Issuers created 104 pools in April totaling over $794 million. April issuance divided into 49 original pools and 55 tail pools. No seasoned original new loan pools were issued. Production of original new loan pools was a healthy $584 million, up from March’s $508 million.

Original pools are those HMBS pools backed by first participations in previously uncertificated HECM loans. Tail HMBS issuances are HMBS pools consisting of subsequent participations. In other words, tail pools are created from the Uncertificated Portions of HECMs that have already had their original HMBS issuance. April’s tail issuance was about $210 million, consistent with tail production the past 12 months.

Last month, total outstanding HMBS just avoided its second monthly shrinkage in a row, growing by a scant $18 million from March. We estimate last month’s change in HMBS balance was composed of approximately $180 million in negative amortization (a record), plus the $794 million in new issuance, minus $957 million in payoffs. Payoffs have exceeded new issuance for eight months in a row.

Payoffs continue to climb as more seasoned HECM loans liquidate or reach 98% of their Maximum Claim Amount (“MCA”). Our friends at Recursion once again crunched the numbers: payoffs from 98% MCA assignments totaled a record $565 million last month. This amount has been rising steadily. According to Recursion, the 98% MCA puts were only $92 million, or 29.8% of payoffs in September 2013. This could mean further shrinkage in HMBS float throughout 2017.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.

HMBS Issuer Rankings 2017Q1 – AAG Back as Number 1

Monday, April 17th, 2017

AAG returned as the #1 HMBS Issuer for the first quarter of 2017, issuing $538.6 million of securities for a 23.3% market share, well ahead of Finance of America Reverse’s $388.5 million and 16.8% market share. Reverse Mortgage Funding slipped to third for the quarter with $364.4 million issued and 15.8% market share. Ocwen Loan Servicing and Nationstar round out the top five issuers. Ocwen issued $306.7 million for a 13.3% market share, and Nationstar was fifth with $237.9 million issued for a 10.3% market share. Live Well Financial remained in 6th place for the quarter. The top five issuers accounted for 79.6% of all issuance, down slightly from last quarter’s 80.8%. There were no new HMBS issuers in the first quarter of 2017.

Despite the much-reported slowdown in HECM endorsements, HMBS issuance remains robust, aided by growth in tail issuance and without highly seasoned pools. Issuance volume totaled $2.308 billion for 2017Q1, on pace with 2016’s full year production of $9.187 billion. 2010 was the record year for HMBS with $10.7 billion of securities issued.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.

HMBS March 2017: Honey We Shrunk the Float, Part II

Thursday, April 13th, 2017

The HMBS market shrank again in March for the second time in the last 4 months, with record prepayment numbers exceeding new issuance and negative amortization. Issuers created 103 pools in March totaling nearly $727 million. HMBS production remained steady as it has for the last several months, with an occasional bump from highly seasoned pools. March issuance divided into 44 original pools and 59 tail pools. No seasoned original pools were issued. Production of original new loan pools was $508 million, down from February’s $512 million.

Original pools are those HMBS pools backed first participations in previously uncertificated HECM loans. Tail HMBS issuances are HMBS pools consisting of subsequent participations. In other words, tail pools are created from the Uncertificated Portions of HECMs that have already had their original HMBS issuance. March’s tail issuance was about $219 million, consistent with tail production the past 12 months.

In December 2016, the HMBS market shrank for the first time as prepayments drove total outstanding HMBS to just under $55 billion. Last month, total outstanding HMBS shrank by about $62 million from February, driven by last month’s record payoffs. We estimate that last month’s change in HMBS balance was composed of approximately $177 million in negative amortization (a record), plus the $727 million in new issuance, minus $966 million in payoffs. Payoffs have exceeded new issuance for seven months in a row.

Payoffs figure continue to climb as more seasoned HECM loans liquidate or reach 98% of their Maximum Claim Amount (“MCA”). Our friends at Recursion Co once again crunched the numbers: the payoffs from 98% MCA assignments totaled a record $550 million last month. This amount has been rising steadily. According to Recursion, the 98% MCA puts were only $92 million, or 29.8% of payoffs in September 2013. This could mean further shrinkage in HMBS float throughout 2017.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.

HMBS February 2017: After January Delirium, February Equilibrium

Monday, March 13th, 2017

The HMBS market returned to equilibrium in February, with both new issuance and outstanding float matching previous levels. Issuers created 97 pools in February totaling nearly $713 million. HMBS production was very similar to November and December 2016, but down significantly from January’s $868 million, which included large seasoned pools. The February pools divided into 48 original pools and a record 49 tail pools. No seasoned pools were issued. Production of original new loan pools was $513 million, down from January’s $525 million.

Original pools are those HMBS pools backed by the first participation in a previously uncertificated HECM loan. Tail HMBS issuances are HMBS pools consisting of subsequent participations. In other words, tail pools are created from the Uncertificated Portions of HECMs that have already had their original HMBS issuance. February’s tail issuance was about $200 million, in line with normal tail production in the past 12 months.

In December 2016, the HMBS market shrank for first time as record prepayments drove total outstanding HMBS to just under $55 billion. Last month however, total outstanding HMBS rose by about $45 million from January, driven by steady issuance, and a drop off from the record payoffs of December 2016. We estimate that last month’s change in HMBS balance was composed of approximately $176 million in negative amortization (a record), plus the $713 million in new issuance, minus $843 million in payoffs. Payoffs have exceeded new issuance for six months in a row.

Payoffs figure continue to climb as more seasoned HECM loans liquidate or reach 98% of their Maximum Claim Amount (“MCA”). Our friends at Recursion Co once again crunched the numbers: the 98% MCA assignments accounted for a record 65% of the dollar amount of payoffs last month. This percentage has been rising steadily. According to Recursion, the 98% MCA puts were only 29.8% of payoffs in September 2013. This could mean further shrinkage in HMBS float throughout 2017.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.

Winter’s Tail: Strong HMBS Issuance Ushers in New Year

Sunday, February 12th, 2017

HMBS issuers began 2017 with a strong month, creating 121 pools in January totaling nearly $869 million. Production of original new loan pools was $525 million, up from December’s $515 million and much higher than January 2016’s total of $469 million. The pools divided into 57 original pools and a record 64 tail pools. The strong issuance was helped by a few large seasoned tail pools from legacy (i.e. non-originator) issuers.

Original pools are those HMBS pools backed by the first participation in a previously uncertificated HECM loan. Tail HMBS issuances are HMBS pools consisting of subsequent participations. In other words, tail pools are created from the Uncertificated Portions of HECMs that have already had their original HMBS issuance. January’s tail issuance was about $344 million, the 3rd highest dollar total ever.

In December 2016, the HMBS market shrank for the first time as record prepayments drove total outstanding HMBS to just under $55 billion. Last month however, total outstanding HMBS rose by about $174 million from December, driven by the large tail issuance and a drop off from the record payoffs of December 2016. We estimate that last month’s change in the outstanding HMBS float was composed of approximately $175 million in negative amortization, plus the $869 million in new issuance, minus $870 million in payoffs. Payoffs have exceeded new issuance for five months in a row.

Payoffs figure continue to climb as more seasoned HECM loans liquidate or reach 98% of their Maximum Claim Amount (“MCA”). Our friends at Recursion Co crunched the numbers: the 98% MCA assignments accounted for a record 62.4% of the dollar amount of payoffs last month. This percentage has been rising steadily. According to Recursion, the 98% MCA puts were only 29.8% of payoffs in September 2013. This could mean further shrinkage in HMBS float throughout 2017.

New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.