RMBS

The Federal Housing Finance Agency (FHFA) confirmed that Fannie Mae and Freddie Mac are exploring possible changes to mortgage servicer compensation, but said implementation is unlikely before the summer of 2012.The current model, in which servicers collect a minimum percentage of the loan balance annually, paid out of the interest stream, "decreases the flexibility necessary for optimal servicing of non-performing loans," FHFA said in a statement released Tuesday.

The secondary market for real estate loans is active despite a dearth of new origination for both the commercial and residential markets.

The Federal Deposit Insurance Corp. (FDIC) will not exercise its authority under the Dodd-Frank Act to reclaim or recover assets transferred by a financial company into a securitization, said FDIC acting FDIC General Counsel, Michael Krimminger in a letter to the industry.

The Association of Mortgage Investors (AMI) is calling for the use of "specialty servicers" to modify and write down delinquent single-family loans, second mortgages, and other consumer debt.

The Treasury Department's continued silence on its pending plan for the future of Fannie Mae and Freddie Mac is fueling suspicion that the administration does not have a concrete proposal.

During the financial crisis, consumers stopped seeking adjustable-rate mortgages, which has perplexed economists at the Federal Reserve Bank of New York.

The residential mortgage division of JPMorgan Chase saw its net earnings more than double to $577 million in the fourth quarter, thanks to rising loan demand and strong profit margins in residential finance.

Although Fannie Mae and Freddie Mac are toying with the idea of changing their servicing contract with seller/servicers, Ginnie Mae is not.

This week the Securities and Exchange Commission (SEC) proposed rules that would require most ABS issuers to still file periodic reports for the life of the publicly registered ABS.

A reduction in mortgage servicing fees by the GSEs would be a "meaningful positive" for the industry, according to analysts with KBW's Keefe Bruyette & Woods.