RMBS

Economists at the Federal Reserve Bank of Cleveland have weighed in on the long-running debate over whether to let bankruptcy judges modify home mortgages, saying evidence suggests the strategy helped stem farm foreclosures in the 1980s.

After the mortgage securitization market shut down and the Treasury Department put the GSEs Fannie Mae and Freddie Mac into conservatorship in 2008, the Treasury issued a white paper suggesting covered bonds as an alternative. The administration and Congress are currently working on enabling legislation.

SMART Servicing, an affiliate of Steel Mountain Capital Management, is offering new software that provides the residential mortgage loan market with loan level information designed to help users control loss severity.

The Federal Reserve purchased around $2.5 billion of Treasurys in its first outright purchase of U.S. government debt since October, according to published reports. The Fed's aim was to prevent money from leaving the financial system.

Although there were sharp disagreements at a Treasury Department conference Tuesday about what kind of role the government should take in the future of housing finance, one idea in particular seems to be gaining momentum: creating an insurance fund to back MBS.

Refinancing activity jumped in the week ending Aug. 13 in response to historically attractive mortgage rate levels.

Nonprofit HOPE NOW is estimating so far in 2010 the industry has completed about 975,000 permanent loan modifications, both government and private, getting close to the one million mark.

The U.S. Treasury Department held its conference on the future of housing finance this morning. Among the speakers at the gathering were U.S. Treasury Secretary Timothy Geithner and PIMCO founder Bill Gross.

Moody's Investors Service reiterated Monday that the possible bankruptcy of Ambac Financial Group is unlikely to affect policyholders of its bond insurer subsidiary.

The U.S. Treasury Department held its conference on the future of housing finance this morning. Among the speakers at the gathering were U.S. Treasury Secretary Timothy Geithner and PIMCO founder Bill Gross.