Two prominent lenders involved in the expanded-credit market shuttered and planned MBS from major issuers are being downsized or pulled altogether.

Non-QM rates are now north of 7% in many cases, but the market is still dealing with upwards of $5 billion in lower-coupon product that needs to be moved.

Issuance of expanded-credit MBS flowed in the first half of the year even as lenders grappled with higher interest rates. Issuance is expected to slow as lenders work to establish a new supply of loans with higher interest rates.

After a two-week lull in issuance of jumbo MBS, a handful of deals hit the market. MBS issuers are facing weak demand from investors, with whole-loan outlets often offering better pricing.

Moody’s downgraded some of the tranches in loanDepot’s outstanding warehouse financing securitizations even after the company modified the transactions’ governing documents to meet new criteria.

Issuance of expanded-credit MBS slowed in April after a surge in the first quarter. Rising interest rates played a role in both moves.

In the secondary market, issuers have had to deal with diminished demand for mortgage products originated prior to the recent runup in interest rates. Is the worst behind the sector?

Most companies that issued non-agency MBS with GSE-eligible investment-property loans during the fourth quarter haven’t offered similar deals thus far in 2022.

Performance of non-agency MBS with manufactured housing loans hasn’t followed the trends seen in other sectors during the pandemic.

Spreads on MBS involving non-qualified mortgages have widened due to rising interest rates and excess supply. However, demand is on the rise again as new buyers are entering the space.