The Institutional Risk Analyst

We expect to see continued consolidation in the world of residential mortgage finance in coming months. The sad fact is that many less competitive businesses in mortgage finance have been waiting for the FOMC to ride to the rescue with lower interest rates. If rate cuts do not materialize in 2025, however, then many of these businesses may not survive.

While GHLD provides a lot of good information about their business, the investor disclosure provided by UWMC is a bad joke, especially when you remember that UWMC is the largest nonbank lender in the US. The Q1 2025 press release is just 9 pages in length and lacks some of the most basic financial information available from UWMC’s peers.

COOP and RKT, plus RDFN, creates an integrated business of realty, lending, servicing and asset management that is impressive

How will the sudden shift in Fed policy impact financials? Are we headed for a recession?

Axos continues to rebound after the bear raid by Hindenburg Research. AX ranked 18th in the WGA Bank Top Index in Q3 2024 vs 98th for SOFI

If the run-of-the-mill Republic First interest rate mark is 13.3% of assets that is not just wiping out one bank’s 8% capital but also FDIC

Industry leaders believe that the FHFA wants the GSEs to offer issuers "repurchase insurance" to the tune of 25bps per loan.

If we are marking balance sheet assets to actual market in the age of deflation, what of the heavily modeled world of servicing assets?

We look for lower prices for legacy MBS and MSRs as new allocations are used up and P&Ls sink deeper into the red...

GS is a securities dealer first and foremost and has no comparative advantage as a bank.

Many in the Buy Side chorus are looking forward to lower interest rates, but we are concerned that next year could really be about solvency

Is 2023 the year of the Return of the Distressed Loan Trade?

The big news this week starts with the poor showing by Rocket Companies (RKT), reporting a loss for Q3 2022 and a big decline in volumes.

Fannie Mae and Freddie Mac will likely sit in conservatorship indefinitely unless and until Congress acts first.

As a result of the adoption of "artificial intelligence," the 21st Century investor is mostly a victim in waiting.

UPST has seen its valuation cut by 60% since March of last year, when its common equity traded at a mere 31x book value.

To paraphrase our friend and fellow mortgage maven Rob Chrisman, ponder a 2022 lending market that’s 75% purchases and just 4.79 million uni

When issuers like RKT and PFSI are paying up for servicing assets, you know that the secondary loan market is getting tougher by the day.

We expect to see a lot more M&A activity over the next 12 – 18 months, as that’s the only way for some players to grow share.

There is, after all, no free lunch for investors when the Fed is serving the thin meal of Financial Repression