MBS and ABS participants gathered in Las Vegas this week, discussing volatility and weak demand from investors. The consensus? Buyers will remain cautious until getting a better handle on the Fed’s actions.

Angel Oak Director Robert McDonough noted the difficulties in pricing climate risks into securities. However, once investors can more actively analyze risks, residential MBS loan pools are likely to change, he said.

Mortgage insurers are good at analyzing credit risk, which might be why a second MI, Radian, has entered the non-agency conduit arena.

A revival in the scratch-and-dent market was a bright spot in non-agency MBS issuance in the second quarter. ECM volume held up better than activity in the prime sector. (Includes three data charts.)

Spreads on various types of residential MBS are wider than they were during the early days of the pandemic, suggesting that the assets aren’t particularly attractive to investors. However, that isn’t necessarily true.

Celebrity Home Loans hired industry veteran Rudy Orman to manage correspondent non-QM loan purchases. The move comes amid turbulence in the market.

Not too long ago, the asking price for scratch-and-dent mortgages was considered silly but buyers paid because the returns were strong. And today? It’s a whole different ballgame.

Freddie recorded the biggest decline in the agency market, while Ginnie dodged the worst of the downturn. Agency multifamily MBS issuance was up, however, as was non-mortgage ABS production. (Includes three data charts.)

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

It’s not every day that bond-investing giant PIMCO pulls out of a market, but for now the whole-loan buyer is avoiding non-QMs. Also, part of the story: the closures of FGMC, Maverick and Sprout Mortgage.