Reeling from rising mortgage delinquencies, Flagstar Bank, FSB saw its long-term deposit rating dropped to ‘Baa3′ Wednesday afternoon by Moody’s Investors Service; the rating level is the agency’s lowest investment-grade rating. Bank financial strength was also lowered to D+ from a previous rating of C-, Moody’s said in a press statement. The downgrade comes as residential [...]

Moody’s Investors Service said Wednesday that while Countrywide Financial Corp.’s recent fourth quarter earnings report was “within expectations,” a new loss component disclosed by the nation’s largest lender may portend problems for other large securitizers of HELOCs. The area of concern: so-called rapid amortization. Buried in Countrywide’s $831 million fourth quarter write-down of residual interests, Moody’s said, [...]

Given the illiquidity in the capital markets right now, the fact that any sort of securitization at all — particularly in subprime or Alt-A — is taking place ought to be news. Which is why Moodys’ rating of an $834 million BofA Alt-A deal on Wednesday is worth noting. The deal, Banc of America Mortgage [...]

As largely expected, the Fed cut the Federal Funds target rate 50 bps on Wednesday — just days after a 75 bp emergency cut. The cut comes as the U.S. grapples with the specter of a looming recession, the first to be led by a historic slump in housing and mortgage banking. The target rate now [...]

The House of Representatives yesterday voted overwhelmingly to pass a modified version of a $146 billion economic stimulus bill. Legislators voted 385-35 in favor of the bill, H.R. 5140, although it’s unclear what sort of sailing lay ahead in the Senate. Bloomberg reported that various senators are pushing to make changes to the House bill, [...]

Underscoring the effect lower rates have had on the primary mortgage market, the Mortgage Bankers Association said Wednesday morning that application activity surged to near a four-year high as borrowers made a beeline for refinancing applications in the past week. The MBA’s Market Composite Index, which measures overall mortgage application activity, was 1054.9 for the week [...]

Flagstar Bancorp, Inc. said Wednesday that it lost $30.1 million, or $(.50) per share, during the fourth quarter as mortgage woes took their toll on the Michigan-based bank. The fourth quarter loss compares to net earnings of $6.9 million, $.11 per share, one year earlier. In spite of the loss, the bank continued to see strong [...]

UBS said late Tuesday that it faced a record loss of roughly $11.5 billion as write-downs tied to the U.S. mortgage market continued to exact a toll on Switzerland’s largest bank. In pre-announcing its fourth quarter earnings, UBS said it lost $12 billion on subprime-related positions, and another $2 billion in other mortgage positions. The write-down [...]

Fannie Mae CEO Daniel Mudd went on Bloomberg TV today to discuss the proposal being floated in Congress to temporarily boost the GSE conforming loan limit from its current level of $417,000. In his interview, he suggests that Fannie would be able to provide much-needed liquidity to the jumbo market — which he says represent [...]

In the wake of junking IndyMac’s debt, Fitch Ratings said Tuesday that it had cut each of the Pasadena-based thrift’s residential mortgage servicing ratings down one notch. IndyMac’s primary servicer ratings for prime, Alt-A and subprime loan products were cut to ‘RPS2,’ from a previous rating of ‘RPS2+.’ A similar cut hit its special servicer [...]