Two new issuers are offering expanded-credit MBS, there’s a securitization backed by newly-originated second liens and the jumbo MBS market is showing more signs of life.
The grid is used by third-party due diligence providers when assessing loans in non-agency MBS for compliance with the TILA-RESPA Integrated Disclosure rule.
The performance of expanded-credit MBS was attractive to investors until interest rates increased throughout 2022. Higher rates cut into excess interest and slowed build-up of credit enhancement levels on outstanding deals.
AB CarVal Investors and Ares Management are in the market with separate expanded-credit MBS, marking the first time either firm has offered that type of MBS.
SFA and others have asked the SEC to extend the comment period on a proposed rule regarding conflicts of interest in the securitization market; SFA revises TRID grid; Fitch reviews RPL MBS; new ABS with Small Business Act Section 7(a) loans.
While the GSEs are under mandates to shrink their retained portfolios, Freddie’s holdings increased in the final three months of 2022. (Includes data chart.)
Redwood Trust isn’t planning to ramp up acquisitions and sales of prime non-agency mortgages in the near term due to elevated interest rates and strong competition from banks for jumbos.
The MBS and ABS markets would experience significant volatility if the federal government doesn’t increase its debt limit. Uncertainty on the outcome is already prompting conservative moves among major investors.
FHA and VA are collaborating with Ginnie Mae on new low- to moderate-income disclosures for MBS pools to help investors meet environmental, social and governance mandates.