RMBS

Mortgage loan applications rose 4.9% on a seasonally adjusted basis in the week ended Aug. 20, and grew 4.5% on an unadjusted basis, as refinancings increased as mortgage rates fell, the Mortgage Bankers Association (MBA) reported Wednesday.

Almost 14% of loan modifications completed in the first quarter of 2010 involved principal reductions of at least 10%, according to the State Foreclosure Prevention Working Group.

The Federal Deposit Insurance Corp. (FDIC) is expected to take final bids on the $23 billion AmTrust servicing portfolio next week with a sale coming by the end of September, according to investment bankers familiar with the offering.

Sales of single-family existing homes plummeted 27% in July from the previous month as the expiration of homebuyer tax credit sucked all the oxygen out of the market. The sales reading was the worst in 15 years.

A financial regulatory reform law that would require ABS issuers to retain at least 5% of the debt they issue is so broad that some market participants are warning the retention requirements could apply to certain municipal bond transactions.

Europe is gearing up for a revival of its RMBS sector after taking a break in August. The latest deal slated to make the rounds next month comes from Santander U.K.'s Fosse master trust structure.

The Federal Reserve could see 20% of its $1.11 trillion portfolio of agency MBS run off due to refinancings and other prepayments by July 2011, according to mortgage strategists at Credit Suisse.

While the call for the creation of a catastrophic insurance fund for MBS has been gaining ground in recent weeks, two leading Federal Reserve Board economists are poised to push the concept one step further, suggesting a backstop for all ABS.

As part of its disposal of U.S. consumer banking businesses, HSBC Holdings is shopping HSBC Mortgage Corp. around. As with many yard sale offerings, the property's attractiveness is up for debate.

Barclays Capital analysts turned to overweight from underweight on the agency MBS basis.