The city councils favorable vote represents a rare notch in the win column for MRP, which has suffered numerous defeats in local jurisdictions across the nation, likely at a substantial loss to the firms financial backers.
Two Harbors revealed that it sold several billions of dollars worth of agency MBS in the third quarter as the assets became less attractive with rising rates. The proceeds will be used to buy MSRs.
The program is intended to provide smaller mortgage lenders that lack direct access to the secondary mortgage market with another option for their home buying customers.
Publicly traded REITs like Redwood Trust would fill the void if Fannie Mae and Freddie Mac lower loan limits next year. But they will be competing against portfolio lenders.
It appears the House of Representatives is giving up on GSE reform this year. However, the Senate could move forward, even though passage is considered a long shot, at best.