Is it time for non-QM originators to hike the interest rates they charge borrowers? It might be a good idea, that is, if they want to maintain profitability.
Non-agency MBS on offer in recent weeks include deals backed solely by mortgages originated by a Community Development Financial Institution, non-agency mortgages for investment properties and proprietary reverse mortgages.
Six issuers offered expanded-credit MBS in recent days, ending a nearly 30-day pause in issuance. Loans in the deals have seasoned for longer than the turn times seen for prime non-agency MBS.
Total non-agency MBS issuance rocketed up 82.8% last year. A huge surge in traditional jumbo loans drove a big increase in prime MBS issuance, helped by the GSE-eligible investor-property sector. (Includes three data charts.)
The latest MBS from Blackstone includes non-agency mortgages for investment properties from various lenders. The firm’s pre-pandemic non-agency MBS were backed by loans from Finance of America.
UWM has its own non-agency MBS shelf, allowing the lender/servicer to directly issue deals. However, the company continues to contribute mortgages to non-agency MBS issued by others.
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Nearly $4.0 billion of non-agency MBS with mortgages for investment properties was on offer in the past two weeks. Many of the deals are backed by GSE-eligible mortgages.
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