Ratings models missed essential collateral risk factors

When — if? — the U.S. private-party securitization market fires back up, RMBS deals are going to face a more stringent — realistic? — set of criteria from at least one rating agency; Fitch Ratings on Thursday unveiled a series of enhancements to its U.S. residential mortgage loss model, known as ResiLogic. The latest revisions to the model will impact Fitch’s expected loss assumptions and credit enhancement levels for RMBS, the company said; what’s perhaps most surprising about the update, however, is that it suggests just how rudimentary some of the ratings process really has been. For example, among the changes in ResiLogic 2.0 are the introduction of MSA and national macroeconomic risk multipliers, which will allow the model to fine-tune its estimates... more»


Suicide right ahead of foreclosure auction

A woman in Massachusetts faxed a note to her lender at 2:30pm — 3 hours before her house was scheduled to be auctioned off in foreclosure — informing them that she intended to kill herself. And she followed through on her threat, right before interested buyers began showing up to bid on the property, too. From the Associated Press: A Taunton woman fatally shot herself soon after faxing a letter to her mortgage company saying that by the time they foreclosed on her house that day, she would be dead. The police said the woman, Carlene Balderrama, shot herself Tuesday, after faxing the letter at 2:30 p.m. The mortgage company called the police, who found Ms. Balderrama’s body at 3:30 p.m. The auction was scheduled to start at 5 p.m. and interested buyers arrived at the property in... more»


Richard Bitner on Bloomberg TV

Bloomberg’s Money & Politics featured HW’s Richard Bitner on a panel discussing Wednesday’s passage of a sweeping housing aid package by the House of Representatives. Note that he’s sandwiched in as the independent, expert industry voice between a CRL rep and a spokesman from the MBA — exactly what we think has been missing from the debate.  Read More →


Bloomberg Discovers the REO Industry

A piece today at Bloomberg co-authored by Bob Ivry marks the financial news outlet’s “come to Jesus” moment with the REO industry, and reading it is certainly amusing for anyone that’s actually spent time working in the space. (BTW, Bob, if you’re ever doing another story on this, we’re here for you on background.) The crux of the article, however, lies here: Together, Fannie Mae and Freddie Mac, the two biggest U.S. mortgage finance companies, owned a record $6.9 billion of foreclosed homes on March 31, compared with $8.56 billion held by all 8,500 U.S. commercial banks and savings and loans. Those outside the industry — and perhaps a good percentage of those inside the industry as well — might miss the real significance here. We know that Fannie... more»


Richard Bitner’s appearance on The Daily Show

For those that missed it, HW’s Richard Bitner hit it out of the part last night on The Daily Show. Enjoy:  Read More →


Reminder: Daily Show, tonight

For those interested to know, our very own Richard Bitner will be on The Daily Show tonight, talking about his new book and the housing mess. This is a very big deal, at least for me a publisher, as I don’t think any other real estate publication — trade or otherwise — has seen one of its key people interviewed on national television about the housing mess yet; and it really underscores why Housing Wire began 18 months ago. Most interviewees are so-called “real estate experts” that haven’t spent a day running a banking operation or working at a servicer in their life. This industry has needed a knowledgeable, credible, and independent voice. Someone with experience who can tell it like it is; which is precisely what I think we’ve been able to establish... more»


HW’s Richard Bitner on Larry King Live

Last week, HW managing director Richard Bitner made the media rounds to tout his new book, Confessions of a Subprime Lender. One of the appearances was on none other than Larry King Live, which means we now officially can say that Larry King has uttered the words “Housing Wire dot com.” Bitner managed to counter the more Pollyanna-ish takes from some of the other panelists, providing at least a dose of much-needed reality. Primary clip: All panelists were also asked whether they were “optimistic” about housing in the near-term; see the below clip, starting around the 7:14 mark: For those that follow these sort of things, Richard will be on The Daily Show with Jon Stewart discussing the housing mess on Monday, July 21. (Yes, really.) And if you haven’t bought... more»


Questions emerge over MBA’s new digs

Rolfe Winkler at Option ARMageddon questions the wisdom of MBA’s recent real estate purchase — in 2007, the trade group purchased a new office building to house its operations (and pull in some income by leasing to other tenants). As the market has continued to tank, however, the weakness in real estate has spread into CRE and since left the MBA holding the bag on tenants that have yet to appear. Winkler writes: … MBA closed the new building deal earlier this year and the association now occupies 40% of it. The rest was to be leased out to help pay the mortgage. Trouble is, [MBA president Jonathan] Kempner can’t find any tenants to share his new digs. With no tenants and deteriorating lending conditions, MBA was forced to put down “10% more” than planned toward... more»


The real cost of loan servicing

Katie Porter at Credit Slips has a transcript of a call from a borrower to his servicer (hat tip, Naked Capitalism). See below. For the record, and contrary to the suggestion being made at Credit Slips (which tends to be a lenders-suck sort of site), there isn’t anything really immediately insidious here in terms of the actual issue at hand — a borrower coming out of BK apparently saw their loan servicing transferred elsewhere (looks like a prior ABN AMRO file, we don’t know when the transfer was or other details), and somehow hadn’t yet paid the servicer’s attorney fees in conjunction with the BK. What’s frustrating in reading the below transcript is the absolute lack of competency shown by the servicing staff in explaining the situation to the borrower.... more»


We need a new bubble

Sometimes fiction mirrors reality — read this at the Onion and tell us there wasn’t a part of you that said “absolutely.” An excerpt: A panel of top business leaders testified before Congress about the worsening recession Monday, demanding the government provide Americans with a new irresponsible and largely illusory economic bubble in which to invest. “What America needs right now is not more talk and long-term strategy, but a concrete way to create more imaginary wealth in the very immediate future,” said Thomas Jenkins, CFO of the Boston-area Jenkins Financial Group, a bubble-based investment firm. “We are in a crisis, and that crisis demands an unviable short-term solution.” Remember: we tend to laugh most at those things that have an element... more»


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Events

2008 Sep 10 -- 2008 Sep 12

USFN Fall Default Servicing Seminar

Well-attended twice-yearly event series for servicers; closed event for USFN members and invited servicers only.

2008 Sep 17 -- 2008 Sep 20

Five Star Conference

Default and REO industry conference, hosted by trade publication DS News. Heavily attended by REO agents.

2008 Sep 23 -- 2008 Sep 24

NREDC's 10th Annual FHA Mortgagees Conference

NREDC brings together the best and the brightest speakers and participants for an exciting creative synergy independent of any trade association.

2008 Oct 19 -- 2008 Oct 22

MBA Annual Convention & Expo

The annual conference for MBA members and affiliates, and the largest industry event each year.

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