Skip to main content

Fitch: Servicers Not Seeing ATR Borrower Claims

Phil Hall
Apr 20, 2016
Two years after the Ability-to-Repay (ATR) rule was forced on the industry, residential mortgage servicers have yet to see any borrower claims

Two years after the Ability-to-Repay (ATR) rule was forced on the industry, residential mortgage servicers have yet to see any borrower claims, according to a new study by Fitch Ratings. However, the ratings agency noted that the lack of claims should not be seen as evidence that ATR is a flop.

“Most loans (including all GSE-eligible loans) meet the definition of a Qualified Mortgage (QM) and receive safe harbor protection from the ATR rule,” said Fitch in a press announcement. “In the non-agency sector, few non-QM loans have been securitized to date. Of the more than 10,000 loans included in Fitch-rated newly originated mortgage pools since the start of 2014, only 14 have been classified as non-QM and are thus vulnerable to ATR claims.”

Fitch added that among the newly originated mortgage pools issued since the start of 2014 and rated by the agency, only three loans are currently more than 60 days delinquent and none of them non-QM. Fitch also cited anecdotal evidence that default rates on non-QM loans that have not been securitized were very low.

But Fitch also warned that this lack of tumult may soon change. “Non-QM origination volume for these products, while still limited today, appears to be growing and could become more common in the future,” the agency added. “Fitch updated its non-QM criteria last month for analyzing the claim likelihood for loans with these risk characteristics.” 

Apr 20, 2016
loanDepot And mellohome Introduce Home Services Bundle

loanDepot, Inc. and its sister company mellohome are launching a proprietary bundle of home buying and selling services.

Industry News
Jul 30, 2021
Gateway Mortgage Surpasses 165 Mortgage Centers With 10 New Additions

Gateway Mortgage reported significant growth in the company, prompting it to open 10 new locations across Colorado, Idaho, Oklahoma, Texas, Oregon, and Wyoming.

Industry News
Jul 30, 2021
FHFA Requires 30-Day Notice Prior To Eviction

Wednesday, the Federal Housing Finance Agency (FHFA) announced that tenants of multi-family properties must be given 30 days notice to vacate before the tenant is required to leave the premise.

Industry News
Jul 29, 2021
Houston-Based Stewart Acquires Title First Agency

Ohio-Based Agency Has 20 Offices And Operates in 32 States

Industry News
Jul 28, 2021
Planet Home Lending Reports Total Origination Volume Of $6.8B In Q2 2021

Planet Home Lending's total origination volume reached $6.8 billion in Q2 2021, up 77% from $3.9 billion in Q2 2020.

Industry News
Jul 22, 2021
FHFA Ends Controversial Refinance Fee

The FHFA announced that Fannie Mae and Freddie Mac will eliminate the Adverse Market Refinance Fee for loan deliveries, starting August 1, 2021.

Analysis and Data
Jul 19, 2021