Two securitizations brought to the market in May were stocked with recently originated non-qualified mortgages as issuers continue to plow their way through the remainder of the pandemic.

Not since the go-go days of the mid 2000s has a national subprime REIT pulled off an IPO. If Angel Oak’s offering goes well, might the floodgates open? Wall Street can only hope.

As much as $20 billion of GSE-eligible mortgages could go into non-agency MBS annually due to new restrictions on GSE acquisitions of mortgages for investment properties and second homes.

It marks the first residential MBS rated by Kroll that aligns with a social bond framework. Fitch Ratings also rated the deal, though the firm appeared to be somewhat less impressed.

In April, issuers offered $4.95 billion of prime non-agency MBS across nine deals. Meanwhile, only two expanded-credit MBS hit the market, totaling $735.58 million.

PR Mortgage Investment is set to issue its first jumbo MBS and Bayview Asset Management revised its strategy for the sector.

Prepayments helped pay down senior bonds, making the remaining subordinated tranches the larger share of an expanded-credit deal’s balance. Result: A larger cushion against potential losses, DBRS said.

Prime non-agency MBS with newly originated mortgages continue to hit the market while expanded-credit issuers are struggling to source loans.

The Federal Reserve wants to continue buying agency MBS at its current pace, which should keep rates and spreads down for the foreseeable future.

Goldman Sachs, JPMorgan Chase and Redwood Trust ramped up issuance of jumbo MBS in recent weeks, while other firms in the sector have still not fully recovered from COVID volatility.