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B&C Servicing: "Deep MI Coverage" Boosts Credit Quality on Subprime MBS Deals.(Brief Article)
During the first quarter, issuers increasingly relied upon "deep mortgage insurance" coverage to bolster the credit quality of structured finance deals backed by subprime credit quality mortgage loans.
Deep MI was used to reduce the average triple-A subordination requirement on more than half of the subprime deals rated by S&P during the quarter, while bond-insurance wraps were used on fewer than a quarter of the transactions.
On fixed-rate subprime deals, the triple-A subordination dropped to 16.3% in the first quarter from 19.27% the previous quarter among deals rated by S&P, reflecting the increasing use of deep MI.
On subprime ARM deals, the subordination average dropped to 16.02% from 20.44%. Average FICO scores and LTV ratios remained relatively flat in the first quarter on subprime transactions rated by S&P for both fixed rate and ARM deals.
Issuers such as Chase Funding, Countrywide Home Loans, Credit Suisse First Boston, First Franklin Financial, IndyMac, Long Beach Mortgage, Option One Mortgage and Amortizing Residential Collateral Trust all used deep MI during the first quarter.
Insurers providing the deep coverage included MGIC, PMI Mortgage Insurance, Gemico and Radian Guaranty. MGIC was the predominant player, covering 46% of the deals S&P rated.
S&P said 54% of the subprime deals it rated had deep mortgage insurance, up from 45% in the fourth quarter of last year.
- "Deep MI Coverage" Gains Favor.
- Magazine article from: National Mortgage News May 14, 2001 700+ words
...Collateral Trust all used deep MI during the first quarter...said the trend toward using deep MI coverage as a credit enhancement...quarters or so. She said the deep MI serves as an additional...characteristics of deals backed by "Alt-A" and closed-end second...
- Fitch discusses deep MI and NIMs.
- Newspaper article from: Asset Securitization Report Tempkin, Adam March 26, 2001 700+ words
...mortgage insurance (deep MI) has become very popular...enhancement in traditional, Alt-A MBS, subprime ABS...explained the basics of deep MI and how this type of policy...the advantages of using deep MI for NIM transactions...
- Mixed feedback on deep MI at S&P conference.
- Newspaper article from: Asset Securitization Report Sibayan, Karen April 9, 2001 700+ words
...higher interest rate on deals that have deep MI, because if there is less subordination...are structured properly, the use of deep MI is a good thing. One major risk is...insurance last year, 19% of which is on Alt-A and A-minus loans, said Glen...
- Deep MI gets higher profile, but lingering doubts remain.
- Newspaper article from: Asset Securitization Report Donovan, Kevin June 25, 2001 700+ words
...paper with exposure to loans backed by deep MI, or lender-purchased insurance. Now...the pool. But the recent acceptance of deep MI on the part of major issuers and subsequent...issuers are now bringing more deals with deep MI, investors are forced to pay attention...
- Citi helps demystify deep MI.
- Newspaper article from: Asset Securitization Report McGeer, Bonnie October 13, 2003 700+ words
...have mortgage insurance (MI). Although deep MI mitigates losses, deals with that insurance...overcollateralization, allow investors to account for how deep MI affects the deals, at least indirectly. "Deep MI is very common in the subprime mortgage market...
- S&P Sees Fewer Deals with 'Deep MI'.
- Magazine article from: National Mortgage News August 13, 2001 700+ words
...70% from about 73%. Meanwhile, subprime transactions with deep MI (additional loan- level mortgage insurance purchased by the...first. (S&P has reported that it will be tracking deep MI subprime deals going forward in order to better gauge portfolio...
- 'Alt-A' Performance Surprises Some.(Brief Article)
- Magazine article from: Mortgage Servicing News Adelson, Mark June 1, 2001 700+ words
...from a recent Nomura Fixed Income Research report on alt-A loans. Alt-A mortgage loans have recently shown noticeably fast...prepayments potentially have disappointed investors who bought Alt- A MBS to partially shield themselves from prepayment...
- ALT Software's OpenGL ES Products to be Distributed with Green Hills Software...
- Press release article from: Business Wire May 16, 2005 700+ words
LIVONIA, Mich. -- ALT Software is very pleased to announce that Green Hills Software has chosen to provide ALT's OpenGL(R) and OpenGL ES solutions...INTEGRITY RTOS package. Also announced today, ALT and Green Hills are working together to...
