Tue, Mar 19, 2024
A A A
Welcome Guest
Free Trial RSS pod
Get FREE trial access to our award winning publications
Alternative Market Briefing

Investment giants and hedge funds face off over Ocwen’s subprime loans

Wednesday, May 27, 2015

Komfie Manalo, Opalesque Asia:

Investment giants and a small group of hedge funds are fighting over subprime scraps, according to Bloomberg.

Blackrock, Pimco and others say that Ocwen Financial Corp., an embattled mortgage servicer that’s been slashing loan balances and lowering interest rates for borrowers, is failing to do its job by modifying loans in ways that make no sense in order to avoid foreclosures, the report says. The hedge funds counter everyone gets more money when Ocwen keeps people in their homes. Ocwen says the ways it deals with delinquent home loans are in line with industry standards.

Guy Cecala, publisher of industry newsletter Inside Mortgage Finance, told Bloomberg, "Ocwen matters because there are more than 2.6 million homeowners still with subprime loans. There aren’t a lot of people signing up to take on this business of servicing subprime or problem loans." There are no new subprime mortgages, but there are still $320bn of them outstanding out of the $9.5tln in total home loans, he added.

Investors (junior bond holders) who benefit most from Ocwen’s strategy have bought riskier slices of the securities. Prolonging the length of time borrowers stay in their homes can lead to big returns from interest payments and possible windfalls from legal settlements with lenders. On the other hand, the senior......................

To view our full article Click here

Previous Opalesque Exclusives                                  
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. KKR raises $6.4bn for the largest pan-Asia infrastructure fund[more]

    Laxman Pai, Opalesque Asia: The New York-based global investment firm KKR has raised a record $6.4bn for its second Asia-focused infrastructure fund, underlining investors' continued appetite for private markets. According to a media release from the alternative assets manager, the figure top

  2. Bucking the trend, top hedge fund makes plans for a second SPAC[more]

    From Institutional Investor: SPACs aren't dead. At least not to the folks at Cormorant Asset Management. The life sciences firm, whose hedge fund topped its peers in 2023, is confident it will match the success of its first blank-check company. Last week, the life sciences and biopharma speciali

  3. Benefit Street Partners closes fifth fund on $4.7 billion[more]

    Bailey McCann, Opalesque New York: Benefit Street Partners has closed its fifth flagship direct lending vehicle, BSP Debt Fund V, with $4.7 billion of investable capital across the strategy. Benefit Street invests primarily in privately originated, floating rate, senior secured loans. The fun

  4. 4 hedge fund themes that are working in 2024[more]

    From The Street: A poor earnings report from Tesla (TSLA) has not hurt the indexes on Thursday. The decline in Tesla stock, which is losing its position in the Magnificent Seven pantheon, is more than offset by strong earnings from IBM (IBM) and ServiceNow (NOW) . In addition, the much higher-t

  5. Opalesque Exclusive: A global macro fund eyes opportunities in bonds[more]

    Bailey McCann, Opalesque New York for New Managers: Munich-based ThirdYear Capital rebounded in 2023, following a tough year for global macro. The firm's flagship ART Global Macro strategy finished the year up 1