Uncertainty on the future of Fannie Mae and Freddie Mac has caused some lenders to deliver their agency-eligible production to the non-agency secondary market.

Issuance of both closed-end second liens and home equity lines of credit declined in the fourth quarter. For the full year, securitization of home equity loans dwarfed 2023. (Includes two data tables.)

The MBS is stocked with investment-property mortgages eligible for sale to the GSEs. Bayview Asset Management last issued a non-agency MBS on its Oceanview shelf in October 2022.

Mortgage real estate investment trusts can still sell unsecured notes to investors, but it’s not as cheap as it was a few years back.

The new licensing requirement represents a major shift for the MBS market, with participants scrambling to either comply or avoid loans in the state. A challenge to the requirements appears likely.

Although Acra Lending could have new owners soon, it continues to strike partnerships. The latest one involves selling non-QMs to an insurance company.

Issuance of prime non-agency MBS tripled from 2023 to 2024, boosting the market to its best year since 2021. Expanded-credit mortgage securitization accounted for 34% of non-agency issuance last year. (Includes three data tables.)

Trump has nominated Bill Pulte to be director of the Federal Housing Finance Agency; Fitch upgrades master servicer rating on Mr. Cooper; new ABS issuer.

Many analysts are projecting increases for issuance of MBS and ABS in 2025. Delinquencies are also expected to rise, though not to troublesome levels.

Analysts say many of the economic forces that have acted as headwinds for the agency MBS market since 2022 are now poised to become tailwinds.