Commercial banks and savings institutions increased their investment in non-mortgage ABS during the fourth quarter of 2018, though the industry’s appetite for the product remained tepid. [Includes two data charts.]

Lower GSE loan limit not a priority for SFIG; whole loans present alternative to non-agency MBS for investors; jumbo MBS issuance may wane with home price appreciation...

Banks originating non-agency mortgages could better compete with the government-sponsored enterprises if the threshold for appraisal exemptions in case of residential real estate properties is raised, industry participants said.

In the past weeks, two lenders active in jumbo mortgages — TIAA Bank and HomeStreet Bank — announced plans to downsize their operations.

Records are falling like dominoes in the nonprime mortgage-backed security market. Verus Mortgage Capital last week issued a $664.09 million deal — breaking a volume record set by Angel Oak Companies a month ago.

Prepayment rates on mortgage-backed securities with non-qualified mortgages have slowed due to interest rate trends and a shift in borrower characteristics, according to industry analysts.

Two nonbanks — Ellington Financial and MFA Financial — are increasing their emphasis on non-qualified mortgages, but with different strategies.

The Structured Finance Industry Group’s years-long effort to reform practices in the non-agency mortgage-backed security market is nearly complete. However, it’s not clear whether the practices will be widely adopted by MBS issuers.

Originations of expanded-credit mortgages increased 20.2% in 2018 and market share for the sector also grew, according to a new ranking and analysis by Inside Nonconforming Markets. [Includes one data chart]

A roundup of stories covering the government mortgage sector.