Losses on non-agency MBS backed by re-performing loans issued in recent years have been minimal, according to DBRS. Performance has been helped by home price appreciation, and the one deal to suffer significant losses was an outlier in terms of the types of loans it included.
The daily trading volume in agency MBS averaged $209.1 billion in 2017, the best showing in four years, according to the Securities Industry and Financial Markets Association.
Statistical sampling, which gained widespread acceptance in MBS repurchase cases after the housing crisis, is being rejected in many courts today, legal experts say.
The year is still young, but two of the largest real estate investment trusts – Annaly Capital Management and New Residential Investment Corp. – have already priced stock deals totaling $852.5 million.