Concept Release on Residential Mortgage-Backed Securities Disclosures and Enhancements to Asset-Backed Securities Registration (SIFMA and SIFMA AMG)

Summary

SIFMA and SIFMA AMG provided comments to the Securities and Exchange Commission (SEC) in response to the Commission's Release Nos. 33-11391, 34-104102, Concept Release on Residential Mortgage-Backed Securities Disclosures and Enhancements to Asset-Backed Securities Registration (the "Concept Release"). SIFMA strongly supports the SEC's review of the requirements of Regulation AB and shares the Commission's goal of enabling a more active registered RMBS market, because this would benefit consumers and investors and would help create a more complete, balanced, and transparent housing finance system.

Excerpt

Via Electronic Mail ([email protected])
December 1, 2025
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549-1090
Attention: Vanessa A. Countryman, Secretary

Re: File Number S7-2025-04: Concept Release on Residential Mortgage-Backed Securities Disclosures and Enhancements to Asset-Backed Securities Registration

SIFMA and SIFMA AMG ¹ (together, "SIFMA") appreciate the opportunity to submit this letter to the Securities and Exchange Commission (the "SEC" or the "Commission") in response to the Commission's Release Nos. 33-11391, 34-104102, Concept Release on Residential Mortgage-Backed Securities Disclosures and Enhancements to Asset-Backed Securities Registration (the "Concept Release"). SIFMA strongly supports the SEC's review of the requirements of Regulation AB and shares the Commission's goal of enabling a more active registered RMBS market, because this would benefit consumers and investors and would help create a more complete, balanced, and transparent housing finance system.

I. Executive Summary

As detailed in this letter, SIFMA's principal recommendations with respect to asset-level disclosure for RMBS and, more generally, the rules governing registered transactions with respect to asset-backed securities, may be distilled into five key categories:

1. Substantially Reduce and Redesign Schedule AL Asset-Level Disclosure Requirements for RMBS to Better Align with the 144A Market

The current asset-level disclosure regime is a significant barrier to registered RMBS and is impractical or impossible to comply with. Required data fields should be aligned with those
that are uniformly provided in the 144A market and are readily obtainable across product types.

Our recommendations include:

• Issuers should be permitted to define each field since the meanings are often ambiguous or may vary between issuers (e.g., "cash-out refinance").
• References to "any transaction party or its affiliates" should be removed from any data fields since it is impractical, if not impossible, to gather information from unrelated business lines.
• Flexible response codes should be included for each data field so that issuers can provide substantive responses as opposed to being forced to choose "Other" or "Not available".

2. Allow Sensitive Data to be Filed in Restricted-Access Systems

Investors require certain loan-level data points that raise privacy concerns, such as five-digit zip codes. The public release of this information raises borrower re-identification risk. Our
recommendations include:

• Only limited, non-sensitive Schedule AL fields should be publicly accessible.
• Sensitive data (e.g., five-digit zip code, credit score, income/asset data) should be provided only through a Commission-operated restricted website, analogous to 144A practices (redacted vs. unredacted tapes via confidentiality agreements).
• The SEC should specify in Regulation AB that receipt of sensitive asset-level data filed on the Commission's restricted website does not create "material non-public information" or Regulation FD issues for issuers or investors.

3. Reduce the Burden of Ongoing Exchange Act Reporting

The lifetime reporting obligations required by the Exchange Act make the issuance of registered RMBS economically irrational. Since they are long-dated assets, the reporting requirements create decades of unpredictable compliance costs as "grandfathering" generally does not exist for any new reporting obligations created under the Exchange Act. To
reinvigorate the registered markets, the Commission will need to take action to reduce the burden of Exchange Act reporting on issuers of asset-backed securities.

4. Modernize Form SF-3 Eligibility Requirements to Align with Actual 144A RMBS Practice

The asset review provisions and the dispute resolution mechanics required by Form SF-3 do not permit the detailed and effective mechanisms that have been developed in the 144A RMBS market. The Form SF-3 requirements should be revised to permit registered transactions that incorporate those mechanisms that both issuers and investors have already determined are acceptable in the 144A market.

5. Conduct a Comprehensive Review and Reform of Regulation AB and Related Rules in Addition to the Issues Raised in the Concept Release

Regulation AB includes outdated disclosure requirements (e.g., mandatory identification of rating agencies even though this has not occurred since Rule 436(g) was repealed). In
addition, overly prescriptive rules (e.g., Item 1100(b)) and rules that are not currently generating meaningful disclosures (e.g., Item 1104(f)) should be revised or eliminated.

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