Emerging Markets

State of Play: Crypto Regulations in the Wake of the FTX Collapse

Nov 23, 2022 | By JOSEPH CIOFFI

The course of regulatory reform in the U.S. related to digital assets is likely about to change as a result of the allegations against Sam Bankman-Fried and FTX affiliated entities in bankruptcy. Prior to FTX’s bankruptcy, and with Bankman’s support, the industry was gaining traction in promoting its own views regarding needed safeguards, including oversight and enforcement by the Commodity Futures Trading Commission (CFTC), rather than the Securities and Exchange Commission (SEC). In the ...

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Mortgage Loans and MBS Auto Loans Quoted

ABS Litigation 'Rules of Engagement' Explained

Nov 08, 2022 | By Credit Chronometer

Joseph Cioffi was quoted in an SCI article, "ABS Litigation 'Rules of Engagement' Explained."

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Marketplace Lending/Fintech Mortgage Loans and MBS Auto Loans Student Loans Publications ESG Emerging Markets

Understanding the Hunstein Decision’s Impact on Debt Collection

Nov 02, 2022 | By Credit Chronometer

In a recent Reuters Legal News article, Joseph Cioffi and Nicole Serratore discuss the Eleventh Circuit Hunstein case and the series of appeals which call into question debt collectors' routine practice of sharing consumer information with third-party vendors as part of collection activities.  Read the full article: Understanding the Hunstein Decision’s Impact on Debt Collection      

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Mortgage Loans and MBS

Refinancing Challenges and Litigations Put Focus on CMBS Valuation

Oct 14, 2022 | By JOSEPH CIOFFI

The “Location, Location, Location” mantra intended to mean the three things that matter most in real estate should be replaced by “Valuation, Valuation, Valuation.”  Valuation is the foundation of a successful CMBS deal and key to setting expectations, from cash flow to recovery. It should take paramount importance in times of economic flux because when, as now, there is uncertainty and the potential for losses, it is the area where deal parties may be most vulnerable to legal claims by ...

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Mortgage Loans and MBS Publications

Repurchase Agreement Redux: Mortgage Loan Originator Bankruptcies Are Back

Oct 13, 2022 | By Credit Chronometer

Residential mortgage warehouse providers acting under repurchase or “repo” agreements as buyers should be assured that safe harbors under the Bankruptcy Code will permit them to enforce their rights under repurchase agreements when originators file for bankruptcy, but, in reality, third parties may interfere. In this Reuters Legal News article, Joseph Cioffi, Massimo Giugliano and Christine DeVito discuss the history of litigation surrounding the structural protections for repo buyers and the ...

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Mortgage Loans and MBS Quoted

Bank of America to Pay $1.84 Billion to Settle Last Major Mortgage-Crisis Suit

Oct 07, 2022 | By Credit Chronometer

Joseph Cioffi was quoted in The Wall Street Journal, "Bank of America to Pay $1.84 Billion to Settle Last Major Mortgage-Crisis Suit."

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Mortgage Loans and MBS Auto Loans

Five Things to Know to Prepare for Consumer ABS Litigation

Oct 06, 2022 | By JOSEPH CIOFFI

As performance risk grows in consumer ABS, legal risks will ensue. To negotiate best terms and prepare for potential disputes, every investor and deal party should know the ways the law has been transformed by years of RMBS litigation. This new legal framework, which impacts when and how claims must be made in order to survive challenge, will ultimately determine who wins and who loses in any future battles over loss allocation. Click the link below for a summary guide to the top five things to ...

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Mortgage Loans and MBS Quoted

How Rising Interest Rates Impact CMBS

Sep 28, 2022 | By Credit Chronometer

Joseph Cioffi was quoted in a Commercial Property Executive article, "How Rising Interest Rates Impact CMBS."

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Quoted Emerging Markets

Maturing CMBS Loans Face Greater Refinancing Hurdles

Sep 19, 2022 | By Credit Chronometer

Joseph Cioffi was quoted in a Wealth Management Real Estate article, "Maturing CMBS Loans Face Greater Refinancing Hurdles."  

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Auto Loans Quoted

The HEAT is on

Sep 07, 2022 | By Credit Chronometer

Joseph Cioffi was quoted in an SCI article, "The HEAT is on."

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Auto Loans Publications

How Companies Can Manage the Risks in Handling Alternative Credit Data

Aug 04, 2022 | By Credit Chronometer

In a recent Reuters article, Joseph Cioffi and Nicole Serratore discuss the legal risks and share practical tips to safely get the most out of alternative data and AI when making credit assessments and collecting and using credit data. Read it here.

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Mortgage Loans and MBS Quoted Emerging Markets

Five Things To Know About Underwriting Cannabis-related Real Estate Loans

Aug 03, 2022 | By Credit Chronometer

Joseph Cioffi was quoted in a Real Estate Capital USA article, "Five Things To Know About Underwriting Cannabis-related Real Estate Loans."

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Emerging Markets

The Crypto Winter Has Led to Summer Bankruptcies

Aug 02, 2022 | By JOSEPH CIOFFI

“Winter is coming. We know what’s coming with it." — Jon Snow,  Game of Thrones, A Song of Ice and Fire Despite record-breaking heat waves setting wildfires across the globe this summer, it seems that nothing can thaw the iciness that is the “crypto winter.” Cryptocurrencies collectively have lost two-thirds of their value (approximately $2 trillion) since their 2021 peak. And, we are now beginning to see the impact of this nosedive on the multi-billion dollar ecosystem of crypto hedge funds, ...

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Marketplace Lending/Fintech Auto Loans Conferences

Conference Replay > How Fintech Is Finally Disrupting Auto Finance

Jun 28, 2022 | By Credit Chronometer

Recently at the Fintech Nexus conference in New York, Joseph Cioffi spoke with Kevin Bennett of Caribou and Michia Rohrssen of UpStart about how Fintech is disrupting auto finance and the outlook for further innovation in a session titled, "How Fintech Is Finally Disrupting Auto Finance." Listen to the full conversation here.

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Auto Loans Quoted Podcast

Identifying Risk Sources with Joseph Cioffi of Credit Chronometer

Jun 17, 2022 | By Credit Chronometer

Joseph Cioffi was interviewed for an Auto Remarketing podcast episode, "Identifying Risk Sources with Joseph Cioffi of Credit Chronometer."

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Auto Loans

The State of Subprime Auto Post-Pandemic

May 31, 2022 | By JOSEPH CIOFFI

Like a car on a bridge buffeted by strong winds, subprime auto lending will be challenged on several fronts as it approaches the other side of the pandemic. Turns out, the anticipated “new normal” may involve a new framework with subprime borrowers under severe financial pressure and regulators watching underwriting, servicing and collection practices. It’s difficult to know if a market change is temporary or represents a trend, but areas of risk can be identified. We talked with some industry ...

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Marketplace Lending/Fintech Auto Loans

How Fintech is Finally Disrupting Auto Finance

May 24, 2022 | By JOSEPH CIOFFI

Sometimes you have to get a “maybe” before you can get a “yes.” That’s apropos of the long path to acceptance of new methods in well-established markets with well-worn channels and dominant players. Auto finance has presented such a challenge, but, finally, Fintech has made inroads. Below, we look at how Fintech is disrupting auto financing and refinancing and transforming the market in multiple areas, including access to credit, speed and efficiency of transactions, and transparency. ...

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Quoted Emerging Markets

Is American Cannabis Still the Wild West?

May 17, 2022 | By Credit Chronometer

Joseph Cioffi was quoted in a National Cannabis Industry Association community blog post “Is American Cannabis Still the Wild West?” Read the full post here.        

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Publications Emerging Markets

Cannabis Financing Market Insights

May 09, 2022 | By JOSEPH CIOFFI

Davis+Gilbert recently attended the Benzinga Cannabis Capital Conference, where the most significant and influential industry participants met to discuss the opportunities and challenges of funding growth in the cannabis industry. Joseph Cioffi moderated a discussion regarding the experience of Real Estate Investment Trusts (REITs) and the outlook for financing and regulations. This piece contains some key takeaways to help participants operate effectively in the space and plan for the future. ...

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Marketplace Lending/Fintech Mortgage Loans and MBS Auto Loans Student Loans Publications ESG Emerging Markets

Reg F:  Finally Bright Line Rules Come to Debt Collection

Apr 27, 2022 | By Credit Chronometer

Joseph Cioffi and Nicole Serratore recently discussed the CFPB’s new debt collection rules relating to communications between debt collectors and consumers, which gives greater control to consumers and reduces legal exposure for complying collectors. With the threat of an economic downturn and delinquencies rising across markets, compliance will become increasingly important, especially in subprime markets. [Read it here]

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ESG Emerging Markets

What To Know About ESG and Cannabis

Apr 14, 2022 | By JOSEPH CIOFFI

Investors and lenders focused on environmental, social and governance (ESG) principles will find opportunities for “green” financing in cannabis, but risk abounds as the truthfulness of ESG claims and disclosures are on the SEC’s radar. Last month the SEC put out a proposed rule that if adopted could lead to increased climate-related disclosures for companies subject to SEC oversight. While cannabis businesses can improve their prospects for funding by emphasizing their ESG-related activities ...

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Auto Loans Quoted

Consumer Watchdog Fires Warning Shot to Lenders Over Abusive Auto Repos as Used-car Prices Soar

Feb 28, 2022 | By Credit Chronometer

Joseph Cioffi was quoted in a MarketWatch article "Consumer Watchdog Fires Warning Shot to Lenders Over Abusive Auto Repos as Used-car Prices Soar".

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Publications Emerging Markets

Fortune or Forfeiture: Real Estate Lending in the Cannabis Space

Feb 08, 2022 | By Credit Chronometer

Joseph Cioffi, Massimo Giugliano and Christine DeVito discuss the risks real estate lenders face when working with cannabis-related businesses, in their Westlaw article entitled "Fortune or forfeiture: real estate lending in the cannabis space." From government forfeiture to anti-money laundering compliance, real estate lenders have options available to address the legal challenges in this rapidly growing field. 

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Auto Loans Reports & Webinars

Webinar Replay > Subprime Auto: Reflections on 2021 and Expectations for 2022

Feb 01, 2022 | By Credit Chronometer

On Thursday, January 27, Joseph Cioffi moderated a webinar titled “Subprime Auto: Reflections on 2021 and Expectations for 2022,” with a panel of industry professionals including Ines Beato, Senior Vice President, US ABS - Global Structured Finance at DBRS Morningstar, Sean Morgan, Senior Vice President of Finance at Westlake Financial Services and Clayton Triick, Senior Portfolio Manager, Angel Oak Capital Advisors. The panelists delved into borrower payment behavior, vehicle pricing, and deal ...

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Auto Loans Reports & Webinars

Normalization Could Be Around the Corner for Subprime Auto

Jan 19, 2022 | By JOSEPH CIOFFI

The third year of the pandemic brings with it questions of when normalization might occur in subprime auto lending and securitization. All eyes are on supply shortages, which have kept used vehicle prices in the stratosphere, and inflation, which could cause consumers financial distress. With these issues in mind, in a recent article in Structured Credit Investor, we compared Credit Chronometer’s 2021 survey responses regarding market expectations with the actual year-end results and made ...

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Auto Loans Publications

Same as Ever?

Jan 18, 2022 | By Credit Chronometer

Joseph Cioffi and Nicole Serratore's article "Same as Ever?" was published in Structured Credit Investor. Click here to view the full article. 

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Marketplace Lending/Fintech

Private Litigation Proliferation in Crypto World

Dec 12, 2021 | By JOSEPH CIOFFI

In recent months, SEC Chair Gary Gensler has referred (on more than one occasion) to crypto as the “Wild West.” As cliché as that may sound, the shoe, or boot, seems to fit quite well. Similar to the aggressive expansion westward in the 1800s that shaped the nation, crypto is a magnet for exploratory investors (as evidenced by a growing total market value of over $3 trillion) and has an opportunity to reshape the financial industry. Yet, just as the Old West era was a time of lawlessness and ...

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Auto Loans Publications

Commentary: Nearly year-end market review

Dec 08, 2021 | By Credit Chronometer

Joseph Cioffi and Nicole Serratore's blog post was republished as an Auto Remarketing article "COMMENTARY: Nearly year-end market review".

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Auto Loans

Subprime Auto: (Nearly) Year-End Market Review

Nov 29, 2021 | By JOSEPH CIOFFI

Delinquencies and losses should be the canary in the coal mine for performance trends, but they can also wag the dog, drawing attention away from looming issues. In subprime lending, borrowers could demonstrate the first indications of trouble for the economy at large, as economic issues tend to impact them first. Now, as auto loan forbearance programs and extended unemployment benefits and stimulus checks have run out, one would expect the subprime auto sector (more than the prime) to start to ...

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Student Loans

A Winter of Servicer Discontent

Nov 14, 2021 | By JOSEPH CIOFFI

Student loan forgiveness efforts are stalled, federal agencies are attacking educational legal issues from a variety of angles, and coordinated action among agencies and attorneys general are expected to increase. With the Biden administration refocusing its efforts on regulatory oversight across various lending sectors, and recent stronger standards passed by the Department of Education (DOE) on issues such as performance, transparency, and accountability, student loan servicers should take ...

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Mortgage Loans and MBS

It Just Got Easier to Be Green in NYC (And It’s Worth It)

Nov 10, 2021 | By JOSEPH CIOFFI

The chances of success greatly improve when you start with a clear goal, set measurable standards, and execute on the plan. So it’s fair to say New York City has taken a big step toward a more sustainable future by finally moving forward with commercial Property Assessed Clean Energy (C-PACE) financing for energy efficient improvements and renewable energy systems in existing buildings in New York City. Below is what building owners need to know to be part of the solution and the magnitude of ...

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Publications Emerging Markets

State Residency Rules Up in Smoke as Cannabis Industry Grows

Nov 05, 2021 | By Credit Chronometer

State residency requirements for cannabis businesses are in jeopardy following some successful challenges on constitutional grounds.  As seen in Westlaw today, Joseph Cioffi, Nicole Serratore and Anna Pinna's article, “State residency rules up in smoke as cannabis industry grows,” discuss how courts have relied on the dormant Commerce Clause of the US Constitution to strike down certain ordinances and regulations.

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Auto Loans Quoted

Rental car securitization enters climate change era with Hertz-Tesla deal

Nov 05, 2021 | By Credit Chronometer

Joseph Cioffi was quoted in a GlobalCapital article "Rental car securitization enters climate change era with Hertz-Tesla deal".

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Mortgage Loans and MBS

What to Watch in Real Estate Alternative Financing

Nov 02, 2021 | By JOSEPH CIOFFI

Inflation forecasts have piqued investors’ interests in adding more real estate to their portfolios, while new technologies and geographic, climate and consumer trends are driving the need for creative and alternative financing structures. Now is the time to get familiar with these arrangements as it won’t be long before they have a significant impact on the credit markets, either through securitizations or competition with traditional pooled assets. An Alternative Focus As travel was ...

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Auto Loans Quoted

Securitization key to Hertz's near-fatal collapse and its resurrection

Oct 28, 2021 | By Credit Chronometer

Joseph Cioffi was mentioned in a SCI article “Securitization key to Hertz's near-fatal collapse and its resurrection“.

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Quoted Publications

Many Americans Are Overpaying for Their Car Loans

Oct 27, 2021 | By Credit Chronometer

Joseph Cioffi was mentioned in a Consumer Reports article “Many Americans Are Overpaying for Their Car Loans“.

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Publications Emerging Markets

Cannabis Lender Eyes Securitization

Oct 22, 2021 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in a Commercial Mortgage Alert article regarding the hurdles of bringing cannabis-related securitizations to market.

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Publications Emerging Markets

Regulatory Challenges to Cannabis Financing

Sep 30, 2021 | By JOSEPH CIOFFI

The tensions between federal and state cannabis laws continue to persist. In this article, we identify the key federal legal issues for financial institutions and lenders when working with state-legal cannabis businesses.

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Publications Emerging Markets

Top 5 Questions Regarding Cannabis Financing

Sep 29, 2021 | By JOSEPH CIOFFI

We provide a quick snapshot of legal issues surrounding lending in the cannabis space, including state-federal regulatory hurdles and debt enforcement challenges for lenders, and business considerations for borrowers when preparing for a deal.

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Publications Emerging Markets

Key Considerations for Cannabis Borrowers

Sep 28, 2021 | By JOSEPH CIOFFI

Finding financing for state-legal cannabis businesses can be a challenge, but with the right preparation, cannabis business borrowers can put their best foot forward to present themselves to potential lenders. We highlight the key considerations borrowers should be ready to address.

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Publications Emerging Markets

NY Debt Enforcement Alternatives for Cannabis Lenders

Sep 23, 2021 | By JOSEPH CIOFFI

With cannabis being federally illegal, bankruptcy protection is not an option for cannabis-related businesses. In an effort to protect collateral and maximize recovery, cannabis lenders need to understand debt enforcement and liquidation options under state law, before entering into financing with borrowers. Learn more in this Law360 article authored by Joseph Cioffi, Seiji Newman and Christine DeVito.

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Auto Loans Quoted Podcast

PODCAST: Davis+Gilbert’s Joseph Cioffi on vehicle-titling challenges

Sep 07, 2021 | By Credit Chronometer

Joseph Cioffi was interviewed for an Auto Remarketing podcast episode, "PODCAST: Davis+Gilbert’s Joseph Cioffi on vehicle-titling challenges," September 7, 2021

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Student Loans

Student Loan Relief is Extended, But Court Relief Remains Elusive

Aug 25, 2021 | By JOSEPH CIOFFI

A respite, however brief, can be refreshing, but the hope is always for more lasting change. For student loan borrowers, the hope has been for COVID-19 loan forbearance to lead to loan forgiveness. Such sweeping action doesn’t appear likely soon. But, there is an alternative that would be more targeted to the neediest borrowers and be more palatable to conservatives in Congress: making bankruptcy discharge more accessible for student loan borrowers. The courts have only inched slowly in this ...

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Marketplace Lending/Fintech Mortgage Loans and MBS Auto Loans Student Loans ESG

Rethinking Your Approach to Insurance

Aug 15, 2021 | By JOSEPH CIOFFI

There are pitfalls that those in asset-based financing should be mindful of, particularly when it comes to insurance and protecting collateral against loss. We spoke with Jack Schwartz, managing director of Davis+Gilbert Risk Management LLC, about key issues to keep in mind when buying policies. Jack has been working with clients for over 15 years with a particular emphasis on real estate and lending transactions. In your experience, do lenders and investors appreciate the importance of ...

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Auto Loans Publications

Can regulators pursue lenders for subprime auto defaults?

Aug 12, 2021 | By Credit Chronometer

Joseph Cioffi and Nicole Serratore's article, “Can regulators pursue lenders for subprime auto defaults?,” was published in Westlaw Today. Click here to view the full article.

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Marketplace Lending/Fintech

Regulators Are Coming, but Can They Corral the Crypto Multiverse?

Aug 08, 2021 | By JOSEPH CIOFFI

Making order out of a multiverse is an extraordinarily difficult task, just ask DC Comics, which has struggled to achieve the success of its rival, Marvel, to create a coherent narrative for its popular superheroes. Regulators in Washington, D.C. and elsewhere must do better if they hope to create a comprehensive regulatory framework for an ever-expanding multiverse of digital coins and digital assets. While the industry grows and diversifies, regulation has been scattershot at best. But crypto ...

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Auto Loans Quoted Podcast

3rd Annual 360 Degree Credit Chronometer Report with Joseph Cioffi, Partner at Davis+Gilbert

Jul 19, 2021 | By Credit Chronometer

Joseph Cioffi was interviewed for an ValueWalk's Value Talks podcast episode, "3rd Annual 360 Degree Credit Chronometer Report with Joseph Cioffi, Partner at Davis + Gilbert," July 19, 2021

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Marketplace Lending/Fintech Mortgage Loans and MBS Auto Loans Student Loans ESG

SCOTUS Raises the Bar for Standing in Consumer Protection Claims

Jul 15, 2021 | By JOSEPH CIOFFI

Lenders, servicers and others regulated by consumer protection statutes may be able to rest a bit easier following the U.S. Supreme Court’s recent decision in TransUnion LLC v. Ramirez (Ramirez), where the Court filtered out over 75% of claimants in a consumer class action because they did not suffer actual harm from the alleged statutory violations. The Ramirez decision is also potentially favorable to certain loan servicers and others regulated under the Fair Debt Collection Practices Act ...

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Auto Loans

In a World Where Subprime Auto Lending Is Illegal

Jul 11, 2021 | By JOSEPH CIOFFI

The deep voiced “In a world . . .” movie trailer narrator is no longer with us, but his legacy lives on, calling us to imagine the unthinkable as we brace for a post–pandemic future. While we enter what we expect to be a moment of increased scrutiny from regulators and legislators with respect to lending and consumer protection, it’s not unreasonable to ask: could subprime auto lending potentially end up outlawed? It would be an extreme prediction for sure. But as we’ve previously discussed, ...

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Auto Loans Quoted Podcast

Subprime securitizations with Davis+Gilbert partner Joseph Cioffi

Jun 29, 2021 | By Credit Chronometer

Joseph Cioffi was interviewed for an Auto Remarketing podcast episode, "Subprime securitizations with Davis+Gilbert partner Joseph Cioffi."

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Auto Loans

Perspectives on 2021: Subprime Auto Optimism and Regulation on the Horizon

Jun 27, 2021 | By Credit Chronometer

Last week, Joseph Cioffi moderated a panel of industry professionals on the state of subprime auto lending and securitization to coincide with the launch of our third annual 360 degree market study, Subprime Auto: Participants’ Expectations Moving on From 2020. Below are some highlights from the panel discussion and additional insights from Joseph and his fellow panelists: Ines Beato, Senior Vice President, US ABS – Global Structured Finance, DBRS Morningstar, Sean Morgan, Vice President of ...

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Auto Loans Quoted

'As good as it gets' — Hertz prints blockbuster ABS

Jun 24, 2021 | By Credit Chronometer

Joseph Cioffi was quoted in a GlobalCapital article, "'As good as it gets' — Hertz prints blockbuster ABS.”

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Auto Loans Publications

Biden Administration Signals Change in Direction for Subprime Auto Regulations

Jun 17, 2021 | By JOSEPH CIOFFI

Joseph Cioffi and Nicole Serratore's article, “Biden Administration Signals Change in Direction for Subprime Auto Regulations,” was published in Westlaw Today. Click here to view the full article.

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Auto Loans Reports & Webinars

Subprime Auto: Participants’ Expectations Moving on From 2020

Jun 17, 2021 | By Credit Chronometer

360° Market Study of Subprime Auto Participants   COVID-19 . . . It was expected to create turmoil in the credit markets and especially decimate subprime lending, which serves the most economically vulnerable consumers... View the full report here.

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Auto Loans Press Releases

Subprime Auto ABS Thriving, But Regulatory Uncertainty Looms

Jun 17, 2021 | By Credit Chronometer

NEW YORK, June 17, 2021 – Subprime auto market participants are expecting some deterioration in 2021 as concerns shift from the economic uncertainty brought about by the pandemic, to regulatory uncertainty ushered in with the new presidential administration. The potential for heightened regulatory scrutiny is weighing on market players, according to the third annual market study released today by Davis+Gilbert LLP’s Credit Chronometer. Authored by Davis+Gilbert partner Joseph Cioffi, the Credit ...

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Mortgage Loans and MBS

Hidden Threats to Lien Priority: How Mortgage Lenders Can Hold Their Ground

Jun 13, 2021 | By JOSEPH CIOFFI

Residential mortgage lending has seemed to fare reasonably well in the thick of the pandemic due to stimulus and relief programs, but as pandemic-era relief recedes and foreclosures rise, hidden threats to a lender’s first priority lien status may become apparent and require resolution. With foreclosures up 9% in the first quarter of 2021 versus the prior quarter, several recent cases highlight why lenders need to be aware of unique and sometimes regionally-specific issues such as superpriority ...

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Mortgage Loans and MBS Quoted

End In Sight for Crisis-Era Case

May 28, 2021 | By Credit Chronometer

Joseph Cioffi was quoted in an Asset-Backed Alert article, "End In Sight for Crisis-Era Case.”

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Marketplace Lending/Fintech

The OCC’s Crypto Charter Craze

May 27, 2021 | By JOSEPH CIOFFI

The epic battle of state regulators versus federal agencies for the right to regulate online financial services shows no sign of ending soon. In 2019, a federal New York district judge found that the Office of the Comptroller of the Currency (OCC) lacks the authority to grant non-depository fintechs special purpose charters. Such charters would enable fintechs providing online financial services to operate as “special purpose national banks” under the National Bank Act without collecting ...

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Student Loans

Of Forgiveness and Forbearance in Student Loan ABS

May 02, 2021 | By JOSEPH CIOFFI

Last week, I moderated a panel on valuation and trends in student loan securitizations and the secondary market at the iiBig Virtual Education Finance & Loan Symposium. Below are some insights from me and my fellow panelists: Ian Rasmussen, Senior Director, ABS, at Fitch Ratings; Mark Weadick, Managing Director at SL Capital Strategies LLC; and Melvin Zhou, Director, ABS Consumer at Kroll Bond Rating Agency. Over a year into the pandemic and things have not turned out the way many expected. ...

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Auto Loans Quoted

Chip Shortage, Virus Working in Favour of Auto ABS for Now

Apr 22, 2021 | By Credit Chronometer

Joseph Cioffi was quoted in a GlobalCapital article, "Chip Shortage, Virus Working in Favour of Auto ABS for Now.”

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Auto Loans

Under the Hood of Subprime Auto: The Timing’s Right for Introspection

Apr 02, 2021 | By JOSEPH CIOFFI

It’s a change of seasons like no other before it. The weather is turning, vaccines are rolling, stimulus is arriving and maybe best of all, Hollywood is luring audiences back to movie theaters to watch titans collide above cities on the biggest screen possible. Down here on the ground, a new administration and an evolving regulatory landscape could bring titanic change to subprime auto. It’s fared relatively well in the pandemic, but now as the light at the end of the tunnel appears, is it a ...

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Auto Loans Quoted Podcast

Credit Chronometer Update with Joe Cioffi of Davis+Gilbert

Apr 01, 2021 | By Credit Chronometer

Joseph Cioffi was interviewed for a ConsumerFi podcast, "Credit Chronometer Update with Joe Cioffi of Davis+Gilbert."

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Student Loans Quoted

Canceled Student Loans May Be Boon for Bonds

Mar 19, 2021 | By Credit Chronometer

Joseph Cioffi was quoted in a Bloomberg article, "Canceled Student Loans May Be Boon for Bonds.”

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Student Loans

The Future of Student Loan Reforms under the Biden/Harris Administration

Mar 18, 2021 | By JOSEPH CIOFFI

With a full plate of health, safety and security priorities on the table and the challenge served up by a deeply divided Congress, the prospects are dim for substantial student loan forgiveness in the early stage of the Biden/Harris Administration. Still, we anticipate the White House will try to find meaningful ways to reform a space that has become a progressive lightning rod. Any significant relief can reshape the future of student lending and securitization. A Modest Proposal for Loan ...

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Auto Loans Quoted

Will Biden's CFPB Clamp Down on Subprime Auto Lenders?

Feb 24, 2021 | By Credit Chronometer

Joseph Cioffi was quoted in an Asset Securitization Report article, "Will Biden's CFPB Clamp Down on Subprime Auto Lenders?”

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Mortgage Loans and MBS

A Housing Policy Wish List under a Biden/Harris Administration

Jan 21, 2021 | By JOSEPH CIOFFI

2020 (and, by the looks of it, 2021) has taught us that predicting the future is no longer merely a fool’s errand as not even Nostradamus would find success in the prognostication business these days. Yet, as we said in our similar post on the subprime auto industry, we can’t let the uncertainty of the times prevent us from preparing for what may lie ahead in policy and programs from the Biden/Harris administration related to housing and residential mortgage lending and servicing. Clues in the ...

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Auto Loans Quoted

Weekly Wrap: Pessimism Mounts in Subprime Auto Outlook

Dec 18, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in Asset Securitization Report, "Weekly Wrap: Pessimism Mounts in Subprime Auto Outlook."

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Mortgage Loans and MBS Publications

The Next Strain of Repo Litigation

Dec 04, 2020 | By Credit Chronometer

Joseph Cioffi and Joel Melendez's article, “The Next Strain of Repo Litigation,” was published in The Real Estate Finance Journal. Click here to view the full article.

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Auto Loans

After Electoral Dysfunction, What Subprime Auto Can Expect From a Biden Administration

Nov 24, 2020 | By JOSEPH CIOFFI

It’s only fitting that we’ll end the year with more uncertainty, this time as a result of the elections. It seems safe to expect a Biden/Harris administration in January, but the road ahead remains a bit foggy pending the Georgia Senate run-off elections in January, the outcome of which will determine which party controls the Senate. Under Democratic control, we could see more progressive programs, while a Republican majority could put the brakes on any aggressive policy agenda. The outcome may ...

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Auto Loans Quoted

Nortridge Launches Podcast Hosted by Current NAF Association President

Nov 04, 2020 | By Credit Chronometer

Joseph Cioffi was mentioned in a SubPrime Auto Finance News article, "Nortridge Launches Podcast Hosted by Current NAF Association President."

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Auto Loans

What Will the Change of Seasons Bring to Subprime Auto?

Nov 01, 2020 | By JOSEPH CIOFFI

Our last market study, based on surveys conducted in the spring – before and then after the COVID-19 crisis began – found industry professionals surprisingly sanguine. Now, as the temperatures begin to cool and the virus rolls in waves across the country against the backdrop of a presidential election and continued uncertainty of future relief programs, we’ve gone back to market participants, including originators, investors, servicers and trustees, to gauge their expectations six months into ...

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Auto Loans Quoted Podcast

The Credit Chronometer with Joseph Cioffi

Oct 29, 2020 | By Credit Chronometer

Joseph Cioffi was interviewed for a ConsumerFi podcast, "The Credit Chronometer with Joseph Cioffi."

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Auto Loans Conferences

“Results of Subprime Auto Securitization Market Study,” 24th Annual Non-Prime Auto Financing Conference, November 16-20, 2020

Oct 27, 2020 | By Credit Chronometer

On November 17, Joseph Cioffi, Davis & Gilbert Insolvency, Creditor’s Rights & Financial Products Chair, will moderate a panel titled “Results of Subprime Auto Securitization Market Study," at the 24th Annual Non-Prime Auto Financing Conference being held virtually on November 16-20. Panel Overview: Join us as we reveal the results of Credit Chronometer’s survey of subprime auto market participants in all areas of the securitization market – originators, investors, trustees, servicers ...

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Auto Loans Publications

Eyes on the Road Ahead: Going Back to the Market for the Latest Outlook

Oct 20, 2020 | By Credit Chronometer

Joseph Cioffi’s article, “Eyes on the Road Ahead: Going Back to the Market for the Latest Outlook,” was published in Non-Prime Times, the official publication of the NAF Association. Click here to view the full article.

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Auto Loans Quoted

Frontline Workers in Eye of Pandemic Storm for Months, Now Fending Off Repo Man

Oct 01, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in a MarketWatch article, "Frontline Workers in Eye of Pandemic Storm for Months, Now Fending Off Repo Man.”

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Auto Loans Quoted

Pandemic to Have Long-Term Impact on US Subprime Auto Market, Says New Report from Davis & Gilbert

Sep 16, 2020 | By Credit Chronometer

Credit Chronometer’s second annual market study “Participants’ Expectations in a Time of Crisis” was mentioned in an Asset Finance International article "Pandemic to Have Long-Term Impact on US Subprime Auto Market, Says New Report from Davis & Gilbert."

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Marketplace Lending/Fintech

OCC Says It Knows How to Identify the “True Lender”

Aug 02, 2020 | By JOSEPH CIOFFI

Tank: “How? Morpheus: “He is the one.” — The Matrix Last week, the Office of the Comptroller of the Currency (OCC) did its best to simplify the search for the one “true lender” in any transaction. Its proposed rule should provide clarity to lending partnerships between banks and third-party non-banks, such as marketplace lenders (MPL).  It’s the OCC’s second step, following its rule regarding the “valid when made” doctrine to end the uncertainty created by decisions like Madden v. Midland. Yet, ...

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Auto Loans

Under the Hood: Quick Subprime Market Inspection

Jul 26, 2020 | By JOSEPH CIOFFI

Is that a cliff or a bridge up ahead? There are positive signs and even slight improvement in some auto figures, but there’s still a looming question of what’s around the corner and whether further government support will be forthcoming. Things could go from stable to not in a New York minute. As we look for signs to the future, recent reports from S&P and KBRA give some indication of where we stand today. Tensions around Extensions Focusing on four major public subprime auto shelves ...

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Auto Loans Quoted

Hertz Nears Temporary Deal with ABS Creditors

Jul 22, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in a GlobalCapital article, "Hertz Nears Temporary Deal with ABS Creditors.”

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Auto Loans Reports & Webinars

Webinar Replay > Subprime RMBS Serves as a Roadmap for Future Subprime Auto ABS Litigation

Jul 16, 2020 | By Credit Chronometer

On Wednesday, July 15, Joseph Cioffi and Seiji Newman led a webinar titled "Subprime RMBS Serves as a Roadmap for Future Subprime Auto ABS Litigation" with featured speaker Todd Krell, Managing Director at CrossCheck Compliance. A full recording of the webinar can be found here.

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Mortgage Loans and MBS Quoted

Seeking Clarity

Jul 16, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in a Structured Credit Investor article, "Seeking Clarity."

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Auto Loans

Listen: Insights from Subprime Auto Market Roundtable

Jul 12, 2020 | By JOSEPH CIOFFI

Credit Chronometer’s second annual market study, available here, has been giving industry participants a behind-the-scenes look at how originators, investors, servicers and trustees are viewing the effects of the pandemic on the subprime auto securitization market. Our recent webinar revealing the results of the study was attended by industry leaders from all areas of the market, including some of the largest originators and securitization participants.  A key benefit for those who attended was ...

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Auto Loans Quoted

Study Highlights Subprime Resiliency during COVID-19

Jun 29, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in a SubPrime Auto Finance News article, "Study Highlights Subprime Resiliency during COVID-19."

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Mortgage Loans and MBS

The Next Strain of Repo Litigation

Jun 28, 2020 | By JOSEPH CIOFFI

As the economic crisis impairs the value of commercial mortgage-backed securities (CMBS) that collateralize loans to real estate investment trusts (REITs) to finance their investments, there is the prospect of increased margin calls, requiring REITs to provide additional funds to make up shortfalls in value. The case of AG MIT CMO, LLC et al. v. Royal Bank of Canada et al., No. 20-2547 (S.D.N.Y.), which recently settled, is worth examining for its echoes of the past and some important lessons ...

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Auto Loans Quoted

The Grapevine

Jun 26, 2020 | By Credit Chronometer

Credit Chronometer’s second annual market study “Participants’ Expectations in a Time of Crisis” was mentioned in Asset-Backed Alert's "The Grapevine."

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Auto Loans Reports & Webinars

Webinar Replay > Subprime Auto: Participants’ Expectations in a Time of Crisis

Jun 25, 2020 | By Credit Chronometer

On Wednesday, June 24, the findings of Credit Chronometer’s second annual market study “Participants’ Expectations in a Time of Crisis” was announced during a webinar titled, “Subprime Auto: Participants’ Expectations in a Time of Crisis, a 360-Degree Market Study.” The webinar was moderated by Joseph Cioffi and had featured speakers Ines Beato, Senior Vice President, US ABS - Global Structured Finance at DBRS Morningstar and Sean Morgan, Vice President of Finance at Westlake Financial ...

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Auto Loans Quoted

Subprime Auto Performance Eyed

Jun 25, 2020 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in a Structured Credit Investor article, "Subprime Auto Performance Eyed."

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Auto Loans Reports & Webinars

COVID-19 Expected to Have Long-Term Impact on Subprime Auto

Jun 24, 2020 | By Credit Chronometer

NEW YORK, June 24, 2020 – Auto market participants are expecting subprime auto loan performance to deteriorate, and many predict COVID-19 will have a long-term impact on the sector. However, participants also show signs of resiliency, according to the second annual market study released today by Davis & Gilbert LLP’s Credit Chronometer. Authored by Davis & Gilbert LLP partner Joseph Cioffi, the Credit Chronometer report, Participants' Expectations in a Time of Crisis, summarizes the ...

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Auto Loans Quoted

Credit Chronometer: Auto ABS Market COVID-era Outlook Similar to Pre-pandemic

Jun 24, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in an Asset Securitization Report article, "Credit Chronometer: Auto ABS Market COVID-era Outlook Similar to Pre-pandemic."

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Auto Loans Quoted

Coronavirus COVID-19 Automotive News: Research, Rides & Growth

Jun 24, 2020 | By Credit Chronometer

Credit Chronometer's second annual market study "Participants' Expectations in a Time of Crisis" was quoted in an AUTO Connected Car News article "Coronavirus COVID-19 Automotive News: Research, Rides & Growth."

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Auto Loans

Carpocalypse or Cartopia: Rethinking the Role of the Automobile in a Pandemic America

Jun 21, 2020 | By JOSEPH CIOFFI

What does automobile ownership mean to consumers today? It is certainly something different, more complex, than pre-Covid. America’s relationship with the automobile has always been complicated. Even so, there has never been a shortage of bold predictions. Now, projections of the future can be downright foolish given we don’t know where we are today as a starting point. And Yogi was right — if you don’t know where you’re going, you might wind up someplace else. The course of the pandemic and ...

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Auto Loans Quoted

Shift in Consumer Behaviour Rewrites the Book on ABS Risk

Jun 18, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in a GlobalCapital article, "Shift in Consumer Behaviour Rewrites the Book on ABS Risk.”

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Auto Loans Reports & Webinars

Subprime RMBS Serves as a Roadmap for Future Subprime Auto ABS Litigation

Jun 16, 2020 | By Credit Chronometer

On Wednesday, July 15, 2020, the Davis & Gilbert Insolvency, Creditors' Rights & Financial Products practice group and authors of Credit Chronometer will be presenting a webinar focused on the subprime auto market. Industry players — originators, investors, servicers, trustees and their advisors — will especially find topics discussed of interest. Overview Record unemployment could drive the market toward litigation, mirroring the battles over loss allocations related to pre-financial ...

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Auto Loans Reports & Webinars

“Subprime Auto: Participants’ Expectations in a Time of Crisis, a 360-Degree Market Study”

Jun 12, 2020 | By Credit Chronometer

On Wednesday, June 24, 2020, the Davis & Gilbert Insolvency, Creditors' Rights & Financial Products practice group and authors of Credit Chronometer will be presenting a webinar focused on the subprime auto market. Industry players — originators, investors, servicers, trustees and their advisors — will especially find topics discussed of interest. Overview Historically, the vulnerability of subprime borrowers to economic shock has been subprime auto participants’ biggest fear. Now that ...

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Mortgage Loans and MBS Auto Loans Publications

Lessons Learned in RMBS Litigation Will Steer Sub-prime Auto Litigation

Jun 10, 2020 | By JOSEPH CIOFFI

Joseph Cioffi’s article, “Lessons Learned in RMBS Litigation Will Steer Sub-prime Auto Litigation,” was published in Non-Prime Times, the official publication of the NAF Association. Click here to view the full article.

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Auto Loans Quoted

Perfect Storm: Hertz Bankruptcy to Reshape Auto ABS?

Jun 09, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in a Structured Credit Investor article, "Perfect Storm: Hertz Bankruptcy to Reshape Auto ABS?”

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Marketplace Lending/Fintech

The “Valid When Made” Rule Strikes Back

Jun 07, 2020 | By JOSEPH CIOFFI

“It’s over, Anakin, I have the high ground.” — Obi-Wan Kenobi, Star Wars Episode III: Revenge of the Sith Last January, we reported on the Office of the Comptroller of the Currency’s (OCC) proposal to codify the “valid when made” rule—a longstanding doctrine that has served as the bedrock for bank lending for nearly two centuries—which, in 2015, was thrown under the bus by the Second Circuit in Madden v. Midland Funding. Valid When Made Under the “valid when made” principle, loan terms ...

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Auto Loans Quoted

The Auto-Appocolypse Could Shove the U.S. Economy Off a Cliff

Jun 03, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in a CCN.com article, "The Auto-Appocolypse Could Shove the U.S. Economy Off a Cliff.” 

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Auto Loans

Whole Lot of Hertz Is Coming to the Used Vehicle Market

Jun 01, 2020 | By JOSEPH CIOFFI

Positioned squarely at the intersection of the used vehicle market, auto ABS and the effects of the coronavirus crisis on American’s mobility is the Hertz bankruptcy filing. Similar to the large bankruptcies, marking the 2008 financial crisis, such as Lehman Brothers and WAMU, which shaped the financial sector’s recovery, the outcome of the Hertz bankruptcy is likely to impact the direction of auto ABS and the underlying auto market in the years ahead. Hertz Debt Problems As air travel has been ...

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Auto Loans

Doom with No Gloom: Forbearances Mask the Impact of COVID-19 on Subprime Auto

May 24, 2020 | By JOSEPH CIOFFI

A review of market performance since the start of the COVID-19 crisis could lead one to ponder a new existential question: Can there be pending doom, if there’s no gloom? Earlier this month, the Federal Reserve Bank of New York released its Q1 2020 report on Household Debt and Credit and, though there was hope it would provide much anticipated insight into the impact that the coronavirus is having on the credit markets, the report itself noted that the data showed “few signs of the COVID-19 ...

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Mortgage Loans and MBS Auto Loans Publications

How Subprime RMBS Can Prepare Us for Subprime Auto Litigation in the Time of COVID-19

May 19, 2020 | By Credit Chronometer

In his latest article published in Consumer Financial Services Law Report, Joseph Cioffi discusses how lessons learned in subprime RMBS litigation could be used in subprime auto litigation, if investors suffer losses. In “How Subprime RMBS Can Prepare Us for Subprime Auto Litigation in the Time of COVID-19,” Joseph addresses several misconceptions regarding subprime RMBS litigation of which subprime auto participants should be aware to set realistic expectations in any litigation. To read the ...

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Marketplace Lending/Fintech

You Down With PPP? Paycheck Protection Program Troubles Are an Opportunity for Marketplace Lenders

May 17, 2020 | By JOSEPH CIOFFI

Few participants involved in the federal government’s Paycheck Protection Program (PPP) will likely be able to escape criticism once the program is all said and done. For the marketplace lenders and fintech companies that have been shut out of the program, the preclusion may ultimately be a blessing. It may also be an opportunity to improve their public image and competitive position by satisfying the goals and markets intended to be served through the PPP. For those who got their wish to ...

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Mortgage Loans and MBS

On Our Watch: CMBS in the Time of COVID-19

Apr 28, 2020 | By JOSEPH CIOFFI

Perhaps no credit market is as much a bellwether for the economic crisis caused by the COVID-19 pandemic than commercial mortgage-backed securities (CMBS). While the impact of relief programs on consumer-based markets remains to be seen, CMBS offers a broad view into the health of consumers, vulnerable industries, the success of stimulus programs on small and medium-sized businesses and the overall economy. Deals in the pipeline may be in jeopardy as parties re-evaluate their positions and ...

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ESG

On Our Watch: ESG in the Time of COVID-19

Apr 23, 2020 | By JOSEPH CIOFFI

Here’s something you don’t see much of these days, a market doing well and with the potential for real “green” shoots. With an emphasis on social responsibility and community support, ESG investing is a bright spot. Still, there are also reasons to be cautious, especially if social issues dominate over environmental ones. There are good reasons to keep investing in both. Positive Market Results ESG funds are outperforming conventional funds, and have been since late March. The ESG market has ...

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Auto Loans

How Subprime RMBS Can Prepare Us for Subprime Auto Litigation in the Time of COVID-19

Apr 19, 2020 | By JOSEPH CIOFFI

“Madness . . . is like gravity, all it takes is a little push.” - The Joker, The Dark Knight, 2008 As our readers know, as far back as 2017, we sounded the alarm on the parallels between pre-crisis residential-mortgage backed securities (RMBS) and today’s subprime auto ABS. Since then, we’ve shared the viewpoints of participants and analysts who have echoed reasons for concern and the competing reasons for disregarding those concerns. Despite all of the differences of opinions, however, and as ...

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Marketplace Lending/Fintech

On Our Watch: Marketplace Lending in the Age of COVID-19

Apr 12, 2020 | By JOSEPH CIOFFI

Marketplace lending took root in the shadow of the last financial crisis. Now, the question for consumers, businesses and marketplace lenders (MPLs) alike, is whether the conditions are right for it to thrive in the wake of the coronavirus and what may be the “deepest recession on record.” No doubt, cash-strapped consumers and small businesses will want to turn to nonbank lenders, such as MPLs and other fintech companies, for funding. MPLs may even be able to provide those loans through the ...

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Auto Loans

Time to Buckle Up: The State of Subprime Auto Risks

Apr 05, 2020 | By JOSEPH CIOFFI

2019 seems far behind in the rear mirror. Way back then, in our 2019 year-end review, we warned that an economic downturn could cause latent market risks to be seen more clearly. Higher delinquencies and longer terms were among the trends that were intensifying beneath the surface, causing cracks to form on the road ahead. With that as a backdrop, we conducted our second annual subprime auto survey with broad participation from nearly 150 market participants of all types, including originators, ...

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Auto Loans Quoted

Why America’s $1.3tn Car-Loan Market Cannot Avoid a Pile-Up

Apr 03, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in The Financial Times article, "Why America’s $1.3tn Car-Loan Market Cannot Avoid a Pile-Up." 

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Auto Loans Quoted

April Cover: Containing Market Fallout in the ABS World

Apr 03, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in an Asset Securitization Report article, "April Cover: Containing Market Fallout in the ABS World."

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Mortgage Loans and MBS

In A World...Without LIBOR

Apr 02, 2020 | By JOSEPH CIOFFI

It could be the trailer for a thrilling movie, but whether it turns out to be a horror flick or a mystery depends on what happens before December 2021. That’s when the financial community’s reliance on the London Interbank Offered Rate (LIBOR) is expected to be phased out. Proposals are on the table, but the prospect of litigation over LIBOR fallback provisions should prompt parties to promote now the creation of clear protocols and legislation. While the coronavirus (COVID-19) has the ...

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Mortgage Loans and MBS

On Our Watch: COVID-19 Mortgage and Foreclosure Relief

Mar 29, 2020 | By JOSEPH CIOFFI

With the fallout of the 2008 mortgage crisis fresh in our minds and still shaping the market and policy, the government and market participants have acted swiftly to step in and offer some immediate relief for borrowers, while keeping liquidity as high as possible. Federal Action The Federal Housing Finance Agency has made plans to suspend foreclosures and evictions for single-family mortgages backed by Fannie Mae and Freddie Mac for 60 days. The HUD would do so for foreclosures and evictions ...

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Student Loans

On Our Watch: COVID-19 Student Loan Relief

Mar 27, 2020 | By JOSEPH CIOFFI

There’s apparently nothing like a pandemic to get the federal government moving on issues surrounding student loans, the second largest segment of consumer debt behind mortgage loans. At this time, only borrowers under federal loans are seeing relief. Private lenders have not reported any sweeping plans, leaving individuals with private student loans to reach out to their servicers for help. Federal Action Initially, the President announced that, starting on March 13, he would allow borrowers ...

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Marketplace Lending/Fintech Quoted

Testing Times: MPL Platforms Addressing Coronavirus Impact

Mar 27, 2020 | By Credit Chronometer

Joseph Cioffi was interviewed by Structured Credit Investor, "Testing Times: MPL Platforms Addressing Coronavirus Impact." 

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Marketplace Lending/Fintech Mortgage Loans and MBS Auto Loans Student Loans ESG

Market Insights in a Time of Crisis

Mar 26, 2020 | By JOSEPH CIOFFI

Distance – the space between – defines our present in so many respects, but that’s not what will lead to success in any market. We have distance from each other, distance from our normal life of just days ago and distance from a future without COVID-19. But that distance has underscored the interconnection of people and markets and their actions like nothing has before. Sure, we knew we were all connected, and we knew the cause and effect of factors that drive our economy, but the coronavirus ...

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Mortgage Loans and MBS Quoted

Court Solution Seen for Libor Issue

Mar 20, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in an Asset-Backed Alert article, "Court Solution Seen for Libor Issue."

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Quoted

Incomplete Fallbacks Attracting Opportunists

Mar 09, 2020 | By Credit Chronometer

Joseph Cioffi was consulted for an Asset-Backed Alert update, "Incomplete Fallbacks Attracting Opportunists."

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Auto Loans

Subprime Auto: There’s No "There" There, Is There?

Mar 05, 2020 | By JOSEPH CIOFFI

As history bears out, "honest disagreement is often a good sign of progress." We’ll take it as a positive sign then that, when taking the pulse of the subprime auto market lately, the discourse surrounding risk levels is becoming more fact-based than we’ve seen in the past. Nothing to See S&P has noted that better collateral is leading to lower losses for prime ABS. Since 2016, subprime ABS cumulative net losses have been stabilizing. Numerous deals have received ratings upgrades, which is ...

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Auto Loans

AFSA Conference: Psst ... PII is a Potential Problem in Auto Finance Services

Feb 27, 2020 | By JOSEPH CIOFFI

It’s only fitting that privacy can be a hidden issue. The impressive innovative platforms and services that are connecting lenders to borrowers, dealers and service providers were on full display at the recent AFSA conference in Las Vegas. These platforms aim to make the finance process better, faster or more efficient but, to do so, many of the services must rely on shared consumer information. It wasn’t surprising to us that the pitfalls of using consumers’ personally identifiable information ...

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ESG

The Emergence of ESG as a Significant Risk Factor

Feb 20, 2020 | By JOSEPH CIOFFI

Recent reports of Australian investors "facing tough questions" over their failure to back climate change resolutions in 2019 highlights increased scrutiny surrounding corporations’ policies on climate change, especially amidst the devastating wildfires that swept through the country earlier this year. The same questions are now being asked globally of borrowers by lenders and investors about their environmental, social and governance (ESG) policies. As we previously noted in a blog post, the ...

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Auto Loans Quoted

GTE Financial's Auto-Loan Securitization Play Could Be a Game Changer

Feb 18, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in an Asset Securitization Report article, "GTE Financial's Auto-Loan Securitization Play Could Be a Game Changer."

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Auto Loans Quoted

Test Drive: Trailblazing Auto-Loan Securitization Paves the Way for Credit Union ABS

Feb 17, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in an Asset Securitization Report article, "Test Drive: Trailblazing Auto-Loan Securitization Paves the Way for Credit Union ABS."

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ESG

NYC is About to a Get a Lot Greener – Priming the PACE Pump

Feb 14, 2020 | By JOSEPH CIOFFI

New York City’s Climate Mobilization Act (CMA), touted as the city’s Green New Deal, is set to have a significant impact on the famous skyline. Property owners should now begin to familiarize themselves with the requirements and choose their optimal funding solutions. In many cases, the solution will be commercial Property Assessed Clean Energy (C-PACE) financing, which allows energy-saving capital improvements made to commercial properties to be financed through a special long-term tax ...

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Auto Loans Conferences

AFSA Vehicle Finance Conference & Expo, February 12-14, 2020

Feb 07, 2020 | By Credit Chronometer

Davis & Gilbert is proud to be a Premier Business Partner and exhibitor at the American Financial Services Association’s (AFSA) Vehicle Finance Conference & Expo in Las Vegas on February 12 – 14, 2020. Be sure to stop by our booth to meet Joseph Cioffi, and to learn more about Credit Chronometer and our Subprime Auto Loan Market Study. For more information or to register, please visit the conference website.

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Auto Loans

Auto Dealer Fraud and Its Impact on Portfolio Performance

Feb 05, 2020 | By JOSEPH CIOFFI

Before you put your money at risk in a Vegas casino, you’d want to know if the dealer was using hidden tactics to rig the game. The same should be said for prudent auto lending and investing – market participants should want to know that the auto dealer hasn’t rigged the game by deceiving the purchaser in ways that make default more likely. Yet, recent government investigations and private actions against auto dealers for misleading and deceptive practices indicate that there could be a lot of ...

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Student Loans

2020 May Be the Year Student Loan Debt Relief Gets Real

Jan 31, 2020 | By JOSEPH CIOFFI

No, getting real does not mean a politician’s grand plans, no matter how close they may get to office. Nor wiping out all student debt and paying for it with a tax on “Wall Street” – which did not create the problem and would, ultimately, impact American’s stock-filled retirement plans – is not a realistic solution either. Beyond fairness and reason, real plans require legal grounding and the support of the courts. So, the markets should take notice that U.S. bankruptcy courts are signaling ...

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Mortgage Loans and MBS Quoted

Long Road Ahead: Climate Change Management in US RMBS Slow to Appear

Jan 23, 2020 | By Credit Chronometer

Joseph Cioffi was quoted in the Structured Credit Investor article, “Long Road Ahead: Climate Change Management in US RMBS Slow to Appear.”

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Auto Loans

Second Annual Subprime Auto Market Study Will Reveal the Current State of Market Participants’ Expectations

Jan 23, 2020 | By JOSEPH CIOFFI

Que sera, sera; what will be, will be. While it may be true, yielding to that platitude is a terrible way to create a successful future. Instead, we say, “what will be, will be what you expect…if you are prepared.” We’re calling on market participants in all roles – originators, investors, servicers, trustees and others – to participate in our second annual 360˚ market study that will analyze industry leaders’ perceptions of where the subprime auto finance market is heading. When the results ...

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Marketplace Lending/Fintech

Marketplace Lending: Market Momentum in 2020

Jan 17, 2020 | By JOSEPH CIOFFI

Expectations are high for marketplace lending in 2020 but, more than any other lending sector, there are legal questions on the horizon that are likely to have an impact going forward. A Market on the Rise Marketplace lending deals have been steadily climbing since FinSight started tracking data in 2013. There was a jump from 2018 to 2019 with the number of tracked deals going from 37 in 2018 to 47 in 2019, and the value of those deals rising from $12.3 billion to $15.2 billion. Recently, Kroll ...

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ESG

PACE and ESG Investing: Market Momentum Heading into 2020

Jan 10, 2020 | By JOSEPH CIOFFI

History is filled with examples of a solution being repurposed to create greater benefits in unintended areas – think, Post-it Notes, the microwave oven and Botox. And often, the goals that spur a specific solution reflect a sea-change of thought that carries across markets. Case in point: Residential Property Assessed Clean Energy financing (R-PACE). In 2019, R-PACE may have declined but the style of financing is being repurposed to tackle other societal issues and in the ascending commercial ...

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Mortgage Loans and MBS

Mortgage Lending and RMBS: Market Momentum Heading into 2020

Dec 19, 2019 | By JOSEPH CIOFFI

With political turmoil, mixed economic signals and some industry-wide changes afoot, unpredictability seems to be the hallmark of the RMBS market. Since unpredictability can make people more dependent on predictions and past experience, we’ve identified some of the key events of 2019 and where they might lead in 2020. Mortgage Lending and Securitization In 2019 we reported on mortgage loan and RMBS performance numbers and noted how much non-qualified mortgages are driving business. While some ...

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Auto Loans Quoted

The Other Subprime Debt Problem

Dec 12, 2019 | By Credit Chronometer

Joseph Cioffi was interviewed for the WNYC Radio Morning Edition program, "The Other Subprime Debt Problem."

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Auto Loans Quoted

Yield-Crazed Investors Pile Into US Subprime Car Loans

Nov 25, 2019 | By Credit Chronometer

Joseph Cioffi was quoted in a Financial Times article, "Yield-Crazed Investors Pile Into US Subprime Car Loans."

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Student Loans

Education Lending: Market Momentum Heading into 2020

Nov 19, 2019 | By JOSEPH CIOFFI

Time keeps on slipping into the future (well, at least since 1976), bringing with it momentum that has the power to shift markets. If we do our homework, we can see where the momentum will take us in 2020.  Examining the Numbers We’re ending 2019 as the land of rising debt. As we reported in September, by some accounts student loan debt has reached $1.6 trillion. Student loan ABS issuance reached $1.8 billion through October 2019, but overall is down 17.3% versus a year ago, according to SIFMA. ...

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Auto Loans

Subprime Auto: Market Momentum Heading into 2020

Nov 07, 2019 | By JOSEPH CIOFFI

Momentum changes everything – it’s hidden, but you know it when you feel it. It has the power to shift markets, so if you find where it’s headed, best to get there first. As we near year end, we’ve identified clues as to where momentum will take subprime auto in 2020, and in subprime auto, the 2019 numbers tell the story. Performance is (almost) Everything Subprime auto origination volume revved up slightly this year and accounted for 21% of all auto loans originated in the first half of 2019, ...

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Auto Loans

How Empty Is the Glass? Experience Level Is Found to Influence Sensitivity to Subprime Auto Market Deterioration and Downgrades

Oct 03, 2019 | By JOSEPH CIOFFI

S&P’s recent downgrade of Class E notes from CPS Auto Receivables Trust (CPSART) 2016-B, 2016-C, 2016-D and 2017-A from BB- to B+ is prompting investors to take a closer look at other deals. It also prompted us to go back over the data from our 360 degree market study to see which constituency group will be most sensitive to the latest news. We found significant differences in the way participants with less than five years’ experience view the sources of risk relative to participants with ...

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Auto Loans

Subprime Auto: 2019 60-Second Market Review and Insights

Sep 19, 2019 | By JOSEPH CIOFFI

Originations and Issuances, by the Numbers Total auto loan debt increased to $1.30 trillion in Q2 2019, up from last year’s $1.24 trillion, and accounted for 9.4% of the $13.86 trillion in national household debt – greater than credit card debt, but less than student loan and mortgage debt, according to Federal Reserve Bank of New York data. In the first half of 2019, new auto loan originations totaled $294.6 billion, of which $60.6 billion was subprime, (credit score <620). The share of ...

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Marketplace Lending/Fintech

Marketplace Lending: 2019 60-Second Review and Insights

Sep 12, 2019 | By JOSEPH CIOFFI

ABS Issuances, by the Numbers Ten securitizations totaling $3.6 billion closed in Q1 2019, down 14% versus a year ago. PeerIQ attributed this decrease to “market volatility,” but noted this still represents the fourth-highest issuance in any quarter. Average deal size decreased to $366 million in Q1 2019, down from $0.6 billion the previous year. SoFi led the way with three deals totaling $1.5 billion in the first quarter, followed by Kabbage with a $700 million securitization. Performance and ...

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Student Loans

Student Loans: 2019 60-Second Market Review and Insights

Sep 10, 2019 | By JOSEPH CIOFFI

Originations and Issuances, by the Numbers Student loan debt stood at $1.6 trillion in Q2 2019, up from $1.53 trillion a year earlier, and now accounts for 10.7% of the $13.86 trillion in household debt, based on Federal Reserve Board of Governors and Federal Reserve Bank of New York data. According to a report issued by DBRS, $19.4 billion in student loan asset-backed securities (SLABS) were issued in 2018, up 16% from 2017. Of the total 2018 SLABS issuances, student loan refinance (refi) ABS ...

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ESG

PACE Financing: 2019 60-Second Market Review and Insights

Sep 05, 2019 | By JOSEPH CIOFFI

Originations and Issuances, by the Numbers Commercial PACE (C-PACE) originations have experienced steady growth, totaling $280.8 million in 2018, up 12% from 2017. Cumulative C-PACE financing is now approaching $1 billion since the inception of the program. However, residential PACE (R-PACE) has been a mixed bag. While originations are thriving in Florida, applications for PACE loans declined considerably in California following new consumer protection regulations, which took effect in April ...

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Mortgage Loans and MBS

Residential Mortgages and RMBS: 2019 60-Second Market Review and Insights

Sep 03, 2019 | By JOSEPH CIOFFI

Originations and Issuances, by the Numbers New mortgage originations reached $474 billion in Q2 2019, up from $437 billion in Q2 2018 (an 8.5% increase), according to data from the Federal Reserve Bank of New York. Housing debt climbed to $9.41 trillion in Q2 2019, up from $9.00 trillion versus a year ago (an increase of 4.6%). Housing debt remains the leading source of consumer debt in the United States at 68% of the $13.86 trillion in national household debt. In Q2 2019, 9.57% of mortgage ...

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Auto Loans

Winter is Coming. Subprime Auto Participants’ Worst Fears May Come True in a Recession

Aug 22, 2019 | By JOSEPH CIOFFI

The phrase “winter is coming” was more than just a motto to House Stark in “Game of Thrones.” It was both a warning and a call to vigilance – the honor in readiness and preparation that was the key to victory. Subprime ABS participants should heed that call. With uncertainty swirling about the economy, even the most sure-footed optimist should be concerned for what lies beyond the seemingly safe path that subprime auto has followed in the past. With the recent stock market drop and the ...

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Auto Loans

Shut the Fraud Door – Impound Fraud Losses Are Preventable

Jul 25, 2019 | By JOSEPH CIOFFI

It happens too often. An auto lender or servicer learns their collateral has been towed for repairs and the garage claims a priority lien that can only be discharged by payment for “major repairs,” compounded by ballooning storage fees, and there is no expectation of payment by the borrower. Faced with paying for expensive charges and fees on a vehicle, many lenders and owners of retail installment contracts give up their lien without much, if any, investigation. The problem is that in many ...

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Auto Loans Quoted Podcast

LISTEN: ValueWalk’s ValueTalks Podcast – “Joseph Cioffi – Participants' Expectations Point the Way to the Future of Subprime Auto”

Jul 19, 2019 | By JOSEPH CIOFFI

Joseph Cioffi recently sat down with Raul Panganiban of ValueWalk, a site covering the latest financial news impacting hedge funds and asset managers with an emphasis on value investing, for their podcast “ValueTalks.” Joseph and Raul discussed the results of Credit Chronometer’s inaugural market study, Participants’ Expectations Point the Way to the Future of Subprime Auto, and in particular, Joseph’s views regarding the outlook of the market based on the anonymous survey results which backed ...

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Auto Loans Quoted Podcast

LISTEN: Auto Remarketing Podcast - “Why Subprime ‘Pessimism’ Might be Merited”

Jul 11, 2019 | By JOSEPH CIOFFI

Joseph Cioffi recently sat down with Nick Zulovich of SubPrime Auto Finance News for an episode of the Auto Remarketing Podcast. The interview took place at the National Auto Finance Association’s Non-Prime Auto Finance Conference in Plano, Texas, where expert presentations and conversations with insiders generally mirrored the results of the Credit Chronometer’s market study, Participants Expectations Point the Way to the Future of Subprime Auto. Adding to all of the great content shared at ...

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Auto Loans

Servicers See It All – Are They the Bellwethers for Subprime Auto’s Future?

Jun 27, 2019 | By JOSEPH CIOFFI

As we continue to break down and analyze the responses to our subprime auto survey, covered in our inaugural market study, servicers, deserve a closer look given the unique vantage point they have in securitizations. It could be easy to overlook them in favor of originators and investors, the alpha and zeta in the chain. Servicers may not have originated the loans, and they may not be as vested in performance as investors, but no other group is on the frontline of collection and loss ...

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Student Loans

Are ISAs the Solution or a New Problem in Student Lending?

Jun 20, 2019 | By JOSEPH CIOFFI

Individual stories tend to get lost when stories are told on a massive scale. Reporting on student debt as a $1.5 trillion problem is like watching buildings being crushed by Godzilla in scenes of sweeping destruction – the focus is on the giant monster and not the impact on the individuals caught in the chaos. Now, a new type of education finance option, known as the Income Sharing Agreement (ISA), is putting the focus solely on the individual student, with the promise of changing the student ...

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Auto Loans

Get the Fraud Out of Here: Highlights from the Dealer Fraud Panel at the NAF Non-Prime Auto Financing Conference

Jun 13, 2019 | By JOSEPH CIOFFI

By popular demand, the National Automotive Finance (NAF) Association’s Non-Prime Auto Financing Conference in Plano, Texas, last week included a close look at one of the biggest challenges facing subprime lenders, dealer and dealer-enabled fraud. I was privileged to be on the panel with an experienced group of professionals: Joel Kennedy, Chief Operating Officer at TruDecision, and newly appointed NAF President who moderated the panel; Zahid Kassem, Principal at Kassem Consulting; Frank ...

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Auto Loans Conferences

"How to Protect Against the Largest Category of Fraud for Lenders?" Non-Prime Auto Financing Conference, June 5-7, 2019

Jun 05, 2019 | By Sample HubSpot User

On June 7, Joseph Cioffi, Davis & Gilbert Insolvency, Creditor’s Rights & Financial Products Chair, will speak on a panel titled “How to Protect Against the Largest Category of Fraud for Lenders?” at the 23rd Annual Non-Prime Auto Financing Conference taking place in Plano, Texas on June 5-7. Panel Overview: The indirect Retail Installment Contract purchase model is inefficient. Dealers don’t always have adequate controls in place to manage the risk of fraud introduced by F&I ...

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Quoted

New Rules

Jun 05, 2019 | By Sample HubSpot User

Joseph Cioffi was quoted in a SCI Magazine article, "New Rules."

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Auto Loans Quoted

Auto Loan-Delinquency Rise Moderates as Banks Focus on Credit Quality

May 31, 2019 | By Sample HubSpot User

Joseph Cioffi was quoted in a S&P Global Market Intelligence article, "Auto Loan-Delinquency Rise Moderates as Banks Focus on Credit Quality."

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Auto Loans Quoted

Study Details ‘Pessimism’ About Future Subprime Performance

May 29, 2019 | By Sample HubSpot User

Joseph Cioffi was quoted in a SubPrime Auto Finance News article, "Study Details ‘Pessimism’ About Future Subprime Performance."

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Auto Loans

Anonymous Survey Finds Reports of Subprime Auto’s Health Are Greatly Exaggerated

May 29, 2019 | By JOSEPH CIOFFI

“There will be time, there will be time To prepare a face to meet the faces that you meet” - T.S. Eliot It’s not uncommon for the privacy of a setting to imbue a conversation with candor, and for the public situation to lead to prevarication. Remember all the folks who stated publicly they could never vote for a certain Presidential candidate, and yet . . . here we are. Diverging statistics in various reports (a recent example being the difference between the latest NY Fed Household Debt and ...

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Auto Loans Reports & Webinars

Subprime Auto Securitization Participants Universally Believe Performance is Likely to Deteriorate, According to New Study by Credit Chronometer

May 27, 2019 | By Credit Chronometer

NEW YORK, May 21, 2019 – Subprime auto loan performance is expected to deteriorate soon, according to a 360-degree market study released today by Credit Chronometer, a microsite authored by Joseph Cioffi, partner at Davis & Gilbert LLP and respected authority on credit markets. The report, Participants’ Expectations Point the Way to the Future of Subprime Auto, summarizes the results of an anonymous study of nearly 100 originators, investors, servicers, trustees and other securitization ...

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Auto Loans Quoted

Market Anxiety Around Subprime Auto Sector Growing

May 22, 2019 | By Sample HubSpot User

Joseph Cioffi was quoted in a GlobalCapital article, "Market Anxiety Around Subprime Auto Sector Growing."

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Auto Loans Quoted

Survey Indicates Growing Worries in Subprime Auto ABS Deterioration

May 22, 2019 | By Sample HubSpot User

Joseph Cioffi was quoted in an Asset Securitization Report article, "Survey Indicates Growing Worries in Subprime Auto ABS Deterioration." 

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Student Loans

Something iiBIG Just Happened: 11th Annual Education Finance & Loan Symposium

May 16, 2019 | By JOSEPH CIOFFI

Last week, Joseph Cioffi moderated a panel on valuation and trends in student loan securitizations at the iiBig 11th Annual Education Finance & Loan Symposium. Below, he provides key takeaways from the conference and shares insights from his fellow panelists: Grant Carwile, Managing Director at SL Capital Strategies LLC Jonathan Riber, Senior Vice President, U.S. ABS at DBRS Melvin Zhou, Director, ABS Consumer at Kroll Bond Rating Agency As the panel discussed at the conference, two of the ...

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Student Loans

Watch Out for Madden v. Midland Risks in Education Lending

May 03, 2019 | By JOSEPH CIOFFI

Success stories of marketplace lending in consumer credit markets are plentiful. They provide models of success for lenders seeking to leverage technology to reach underserved markets, but along with the successes, there is a significant legal issue that has impacted marketplace lending of which student loan lenders and investors should be aware. We’ve written about Madden v. Midland Funding (Madden) risks in prior blogs and articles in connection with marketplace lending. A recent settlement ...

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Student Loans

Behind-the-Scenes Strategies for Success – Part Two: We Speak to Revenue Connections on the Importance of Borrower Attributes to Student Loan Collections

Apr 17, 2019 | By JOSEPH CIOFFI

Take care of your business at home, before searching for greener pastures. It’s a key takeaway from Part One of our interview regarding subprime auto: lenders and servicers with modernized collection and recovery systems have a solid foundation for profitability that should be a requisite before embarking on business development plans. In Part Two of our discussion with David Albers, CEO of Revenue Connections, we asked David to share his advice on ways to positively impact collection efforts ...

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Auto Loans

Behind-the-Scenes Strategies for Success: We Speak to Revenue Connections on Improving Collections to Combat Latent Market Risks

Apr 11, 2019 | By JOSEPH CIOFFI

Sometimes, it’s what you can’t see that matters most. First, the bad news: after years of economic growth and generally good times, consumers’ credit scores may be inflated. Like 50 is the new 40, a prime score today may be the equivalent of a sub-prime score pre-financial crisis. If you believe a leopard doesn’t change its spots, a high credit score may be masking a borrower’s likelihood to default in bad times, and the risk on subprime loans is bigger than believed at origination. Now, the ...

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Auto Loans

Following the Backup Plan – Part Two: We Talk to CAR Financial Services on the Keys to Successfully Engaging a Backup Servicer

Mar 29, 2019 | By JOSEPH CIOFFI

This is part two of our interview with the executive team at CAR Financial Services, a subprime auto finance company with over 25 years of experience providing customized backup and successor servicing. In part one of our interview, we discussed the benefits of having a backup servicer in place before trouble starts. But once you decide to take the prudent course and engage a backup servicer, how do you know you are getting the best value from the relationship? Here, we discuss with CAR the ...

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Auto Loans

Part One: As Delinquencies Rise in Subprime Auto, We Explore a Protective Strategy with Backup Servicer, CAR Financial Services

Mar 22, 2019 | By JOSEPH CIOFFI

If subprime auto delinquencies continue to rise and the risks continue to grow, it will be cold comfort to those who saw it coming, if they haven’t taken protective measures. There’s no glory being on the wrong side of right. From this perspective, there is real value in any service that has the potential to help participants see ahead of the curve and mitigate risks. With this in mind, we spoke to Justin Bannister, Director of Centralized Operations, and Oscar Lopez, Specialty Products ...

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Auto Loans

Subprime Auto: The Truth Is Out There

Feb 28, 2019 | By JOSEPH CIOFFI

Red and blue is the new black and white, but the country could use a lot more purple. Seems few can take a position publicly these days unless it’s extreme – whether it’s a political debate or the meaning of the New York Fed’s recent Quarterly Report on Household Debt and Credit showing an uptick in subprime auto delinquency. Intelligence includes the ability to see the other side’s point of view. The truth is out there – and it can be found in the gray area between the absolutists. There Are ...

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Auto Loans

How Subprime Auto Participants Can Avoid the Hell of a Future Unseen

Feb 14, 2019 | By JOSEPH CIOFFI

If you want to know the truth, no one can really predict the future of any market by themselves; everyone is limited by data and perceptions. Without shared knowledge and experience, the future remains a puzzle only time can solve. Where there is limited information, J.D. Salinger’s prediction is inevitable: “the fact is always obvious much too late.” But in subprime auto ABS, we don’t have to succumb to Salinger’s fatalism. By taking the pulse of all types of industry participants – lenders, ...

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Quoted

Auto Lending Accelerates but Performance Weakening

Feb 13, 2019 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in a GlobalCapital article, “Auto Lending Accelerates but Performance Weakening.”

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Auto Loans Quoted

Junior Demand: Credit Enhancement Concerns Raised

Feb 08, 2019 | By Sample HubSpot User

Joseph Cioffi was quoted in a Structured Credit Investor article, “Junior Demand: Credit Enhancement Concerns Raised,” February 8, 2019.

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Mortgage Loans and MBS Auto Loans Quoted

Subprime Loans Set to Grow in Personal and Mortgage But to Fall in Auto

Jan 23, 2019 | By JOSEPH CIOFFI

Joseph Cioffi contributed to a Blueshift Research report, “Subprime Loans Set to Grow in Personal and Mortgage But to Fall in Auto,” January 23, 2019.

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Student Loans

When An Act Is Not A Disclosure, States Win the Preemption Battle

Jan 16, 2019 | By JOSEPH CIOFFI

Like Ali v. Frazier II and III, it’s not much of a rivalry if one side keeps winning the decision. The battle began when the Department of Education fired a shot across the bow with its letter arguing that state laws attempting to regulate student loan servicers – whether through licensing requirements or consumer protection laws – were preempted by federal law, which calls for uniform administration of federal student loan programs. Now state victories are starting to pile up. Given consumer ...

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Auto Loans Quoted

2019 Survival Guide: How Lenders Are Planning for the Year Ahead

Jan 04, 2019 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in an Auto Finance News article, “2019 Survival Guide: How Lenders Are Planning for the Year Ahead.”

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Auto Loans Quoted

Risk Factors to Watch in 2019

Jan 02, 2019 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in an Auto Finance Excellence article, “Risk Factors to Watch in 2019.”

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Auto Loans

Honor Finance’s Downfall Shows Anything Can Happen

Dec 05, 2018 | By JOSEPH CIOFFI

No one had suffered any losses, or at least it seemed no one could remember having done so. S&P had not downgraded any subprime auto loan ABS since just after the turn of the century or any other auto loan ABS since 2011. Credit enhancements were widely deemed sufficient to absorb any worst-case scenario. With a long track record of success and protections in place, few blinked when one non-bank lender, Honor Finance, went decidedly deep down the credit scale. It was 2016 and Honor Finance ...

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Mortgage Loans and MBS ESG

Tiny Spaces, but Lots of Room for Pace-Type Financing

Nov 20, 2018 | By JOSEPH CIOFFI

Move over mortgages – there’s a new kind of real estate that could benefit from a new type of funding. As higher interest rates and rising prices are making affordable housing a challenge in many markets, cities can fight the problem with a small-scale solution – accessory dwelling units (ADUs). What’s an ADU? ADUs are additions (attached or detached) to homes or converted spaces within already existing buildings that can be used as rental units. Local governments on the west coast have become ...

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Mortgage Loans and MBS

Once Bitten, but Not Shy: Subprime Mortgage Lending Is Alluring Again

Oct 31, 2018 | By JOSEPH CIOFFI

Bright, shiny objects are hard to resist. Like the glowing orb cast by the anglerfish – the last thing its prey sees before the deadly bite – subprime lending is back with the potential for profits shining like a beacon. There are several ways for lenders and investors to grab a piece of the action, but are the latest moves tempting a fate similar to 2007? There’s smoke . . . Although the housing market has been a relative sea of calm in recent years, the mortgage market has slowed down. ...

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Student Loans

As Less Enforcement Leads to More Lawsuits, We Speak to Education Loan Finance on Ways Lenders and Servicers Can Avoid Future Issues

Oct 17, 2018 | By JOSEPH CIOFFI

It’s been said that a war doesn’t determine who is right, but rather, who is left. Although there’s been much talk of an epic battle between states and the federal government that will determine the scope of federal preemption in the student loan space, it’s not going to be much of a fight if only one side shows up.  If current trends hold, it looks like states will be left to dominate the legal landscape of consumer protection. In the wake of statements by the resigning student loan ombudsman ...

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Student Loans

Student Debt Burden: Whose Problem Is It, Anyway?

Sep 20, 2018 | By JOSEPH CIOFFI

It’s back to school time, and there’s so much noise about a student loan crisis that there’s a need to corral all the noisemakers and to gain an understanding of what’s actually going on. Sister Mary Elephant had the right idea when she scolded her classroom to be quiet some 40 years ago. It does sound pretty bad. Student debt surpassed $1.5 trillion earlier this year, and it’s estimated that nearly 40 percent of borrowers will default on their student loans by 2023. But talks of a collapse are ...

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Auto Loans Quoted

Credit Enhancement Can’t Cure All Ills in Subprime Auto Market

Sep 06, 2018 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in an Asset Securitization Report article, “Credit Enhancement Can’t Cure All Ills in Subprime Auto Market.”

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Auto Loans

Dis-Honor in a Downgrade – Strong Management and Credit Enhancements Mean More Today Than Yesterday (But Not as Much as Tomorrow)

Aug 02, 2018 | By JOSEPH CIOFFI

There’s a caution flag out for subprime auto loan securitizations. The Class C tranche of Honor Finance’s HATS 2016-1 – the deal that jump-started the debate as to how low deep subprime issuances could go before subprime auto ABS’s reputation for safety would be blemished – has been downgraded by S&P and KBRA. And now, what investors looked for yesterday is likely different than what investors will look for today. Two areas to watch: the strength of management and the level of credit ...

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Auto Loans Quoted

Honor Finance’s ABS Downgrade Signals Market Contraction

Jul 30, 2018 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in an Auto Finance News article, “Honor Finance’s ABS Downgrade Signals Market Contraction.”

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ESG

PACE Financing: 60-Second Market Review and Insights

Jul 17, 2018 | By JOSEPH CIOFFI

Originations and Issuances, by the Numbers To date since the inception of Property Assessed Clean Energy (PACE) financing, $5.17 billion has been advanced to homeowners under residential PACE (R-PACE) programs, and an additional $672 million has been advanced for commercial PACE (C-PACE) projects. In 2017, R-PACE originations totaled $1.6 billion, down 6% compared with 2016. In 2018 so far, R-PACE originations have reached $372 million. C-PACE originations, on the other hand, are on the rise, ...

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Mortgage Loans and MBS

Residential Mortgages and RMBS: 60-Second Market Review and Insights

Jul 12, 2018 | By JOSEPH CIOFFI

Originations and Issuances, by the Numbers New mortgage originations reached $428 billion in Q1 2018, down from $491 billion in Q1 2017 (a 12.9% decrease), according to data from the Federal Reserve Bank of New York. However, housing debt climbed to $8.94 trillion in Q1 2018, up from $8.63 trillion versus a year ago (an increase of 3.6%). Housing debt remains the leading source of consumer debt in the United States at 68% of the $13.21 trillion in national household debt. As such, it can be a ...

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Auto Loans

Subprime Auto Loan Crisis Chronometer Update

Jul 02, 2018 | By JOSEPH CIOFFI

“They are who we thought they were!” Observing the rising tide of borrower delinquencies in subprime auto lending, I’m reminded of that famous outburst by the former NFL coach, Dennis Green. No one should be that surprised when subprime borrowers default. The question has always been and will continue to be whether credit enhancements – like overcollateralization and excess spread – will be sufficient to absorb the resulting losses.  Now that lower grade tranches have gained popularity among ...

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Marketplace Lending/Fintech

Marketplace Lending: 60-Second Market Review and Insights

Jun 27, 2018 | By JOSEPH CIOFFI

ABS Issuances, by the Numbers Seven securitizations totaling $4.3 billion closed in Q1 2018, up 34% versus a year ago and representing the second-highest issuance in any quarter (after Q4 2017). Q1 issuances comprised $2.1 billion in student loan ABS, more than double Q1 2017 and the highest ever quarterly issuance of student deals. Total ABS issuance is expected to climb to $18 billion in 2018, up 30% from 2017. Performance and Practices Delinquencies increased in Q1 2018 across the consumer ...

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Student Loans

Student Loans: 60-Second Market Review and Insights

Jun 20, 2018 | By JOSEPH CIOFFI

Originations and Issuances, by the Numbers Student loan debt rose to $1.52 trillion in Q1 2018, up from $1.44 trillion a year earlier, and now accounts for 10.7% of the $13.21 trillion in total household debt, based on Federal Reserve Board of Governors and Federal Reserve Bank of New York data. According to a report issued by DBRS, $16.7 billion in student loan asset-backed securities (SLABS) were issued in 2017, up 10% versus a year ago. Of the total 2017 SLABS issuance, student loan ...

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Auto Loans Quoted

Ballooning Losses at Honor Finance Spark KBRA Downgrade Warning

Jun 13, 2018 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in an Auto Finance News article, “Ballooning Losses at Honor Finance Spark KBRA Downgrade Warning.”

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Auto Loans Quoted

Undisciplined Nonbank Subprime Auto Lenders Still at Risk

May 31, 2018 | By JOSEPH CIOFFI

Joseph Cioffi contributed to a Blueshift Research report, “Undisciplined Nonbank Subprime Auto Lenders Still at Risk.”

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Student Loans

iiBig 10th Annual Education Finance & Loan Symposium

May 17, 2018 | By JOSEPH CIOFFI

Last week, Joseph Cioffi was a featured speaker at the iiBig 10th Annual Education Finance & Loan Symposium in Alexandria, Virginia.  He participated in a panel regarding the latest trends and issues impacting collections and also moderated a panel on valuation and trends in student loan securitizations.  Below, he shares key takeaways from the conference and shares insights from his fellow panelists. The conference was highly informative, including the insights of the experts on the ...

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Auto Loans

Usury: An Old Concept, Up to New Tricks in Subprime Auto

Apr 23, 2018 | By JOSEPH CIOFFI

Usury has made quite a comeback from the dust heap of old law treatises to become a crucial concept that has shaped modern credit markets. It recently returned to public awareness in marketplace lending, where online lenders have avoided making loans in states comprising the Second Circuit, such as New York, due to an unfavorable usury decision. Now, light has been shed on subprime auto financing and an exception to usury laws that’s creating risk for an already shaky market. Usury: It’s An Old ...

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Student Loans Publications

Law360, “Federal Vs. State: The Fight To Regulate Student Loans”

Apr 18, 2018 | By JOSEPH CIOFFI

Joseph Cioffi discusses the heavyweight fight brewing between federal and state authorities over whose rules should govern the servicing of student loans in his latest article published in Law360. In “Federal Vs. State: The Fight To Regulate Student Loans,” the authors note that the battle appears headed for the courts, where the outcome will likely depend upon judicial interpretation of the preemption doctrine.  To read the full article, click here.

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Student Loans Publications

Federal Vs. State: The Fight To Regulate Student Loans

Apr 10, 2018 | By JOSEPH CIOFFI

Joseph Cioffi’s article, “Federal Vs. State: The Fight To Regulate Student Loans,” was published in Law360. Click here to view the full article.

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Student Loans Quoted

Lawyers Eye Student-Loan Servicers

Mar 16, 2018 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in an Asset-Backed Alert article, “Lawyers Eye Student-Loan Servicers.”

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Student Loans

The Latest Non-Answer to the Student Loan Debt Burden: Foregoing Social Security Benefits

Mar 16, 2018 | By JOSEPH CIOFFI

College students – prepare to be educated on a new case of Hobson’s choice, a term typically used to describe situations where there appears to be a choice available, but in reality, there is no choice at all.  It’s named after a stable owner in England who rented out horses, but would only offer customers the horse nearest the stable door.  But this time around, the concept is reflected in a proposed bill that would offer student loan borrowers debt elimination in exchange for delaying their ...

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Auto Loans Quoted

Subprime Auto Bonds Caught in Vise of Rising Costs, Bad Loans

Mar 14, 2018 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in a Bloomberg article, “Subprime Auto Bonds Caught in Vise of Rising Costs, Bad Loans.” Click here to view the full article.

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Auto Loans

Electric Vehicles Will Create Risks, Spur Changes in Auto ABS

Mar 06, 2018 | By JOSEPH CIOFFI

New Tech, New Risks There are always risks to forging a new path. When it comes to electric vehicles (EVs) like the Model S and Model X that back Tesla’s latest deal, there are peculiar risks beyond those that normally accompany auto asset-backed securities (ABS). Given a lack of historical data, there is the risk of uncertain residual or resale values, and moreover, the potential for those values to fall below expectations for any number of reasons. For example, new technology may emerge that ...

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Auto Loans

LISTEN: Center for Auto Finance Excellence’s “The Roadmap” Podcast – “How ABS Credit Enhancements Are Masking Subprime Risk”

Mar 05, 2018 | By JOSEPH CIOFFI

Joseph Cioffi recently sat down with William Hoffman, Associate Editor of Auto Finance News, for an episode of “The Roadmap,” a podcast from the Center for Auto Finance Excellence, a site dedicated to providing best practices for auto finance industry executives and investors. Joseph and William discussed trends apparent in recent subprime auto loan securitizations, and the outlook for the market going forward, including a close look at the interrelationships between credit enhancements, credit ...

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Auto Loans Quoted

5 Ways Mobility Will Change the Secondary Market

Feb 28, 2018 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in an Auto Finance News article, “5 Ways Mobility Will Change the Secondary Market.”

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Mortgage Loans and MBS Quoted

HELOCs Poised For Comeback in 2018

Feb 26, 2018 | By JOSEPH CIOFFI

Joseph Cioffi was quoted in a GlobalCapital article, “HELOCs Poised For Comeback in 2018.”

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Student Loans

The Economic Payoff of a Student Loan Payoff

Feb 21, 2018 | By JOSEPH CIOFFI

For all the talk about Dreamers in the national immigration debate, a recent research paper positing the positive effect of erasing the nation’s $1.3 trillion student debt burden has given the term new meaning.  If someone could wave a magic wand and make student loan debt disappear, we would hear the collective cheers of student borrowers all the way to the moon.  But rather than treat such an act like a fairy tale, a group of economists here on earth went about determining the kind of ...

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Auto Loans

What the Fargo?  Doubling-down on Loans and Deposits is a Dubious Move Following the Fed’s Order

Feb 15, 2018 | By JOSEPH CIOFFI

Wells Fargo is being put on a highly restrictive diet by the Federal Reserve and won’t get any relief until its compliance and governance shape up.  Under the terms of the Fed’s Consent Order, Wells cannot grow its consolidated assets beyond the total consolidated assets reported at the end of 2017.  Although Wells is dismissing the effect of the Order as a nothingburger, if there’s really no effect, it’s probably because Wells already lacks opportunity for growth in deposits and lending as a ...

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Auto Loans

Subprime Auto in 2018: Riding a Market That’s All Show and No Go

Jan 31, 2018 | By JOSEPH CIOFFI

If the subprime auto loan asset-backed securities (ABS) market collapses, any post-mortem is likely to begin and end with the underlying auto market.  Of course, it won’t all be about sales practices and consumer trends – there would also likely be closely-related contributing factors in lending and ABS practices.  But despite growing concerns, following the 2018 Detroit Auto Show, it appears the auto market is poised for a year of activity centered mainly around “innovations” that are ...

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Mortgage Loans and MBS

Subprime Residential Mortgages and RMBS in 2018: A Tale of Two Cycles

Jan 29, 2018 | By JOSEPH CIOFFI

Ten Years Gone, but the Memory Remains Litigation related to pre-financial crisis subprime mortgage lending and securitization has resulted in a decade-long hangover for many of those who participated in the boom times. The boom actually lasted only four or five years for most participants, but more than a decade later, many are just now drawing closer to resolution of legacy disputes.  The lingering headache for lenders, sponsors, trustees and investors explains the caution that has been the ...

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ESG

PACE Financing in 2018: Against the Wind

Jan 25, 2018 | By JOSEPH CIOFFI AND SEIJI NEWMAN

Whether or not you believe in global warming, the recent frequency of severe climate-related events – from mudslides to bomb cyclone snowstorms – suggests Thomas Friedman had it right years ago when he coined the phrase “global weirding.” One would think that in this environment, the outlook for Property Assessed Clean Energy (PACE) financing, which makes energy efficiency possible for the average homeowner, would be sunny and bright. Consider further that Bitcoin, a mostly speculative pursuit ...

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