REITs with non-agency operations look attractive to stock analysts as the Trump administration works to decrease the footprint of the government-sponsored enterprises. REITs cited as “top picks” include Ellington, New Residential and Starwood.
Velocity Financial, an active securitizer of nonprime mortgages, is ready for its maiden voyage in IPO land. One thing is for certain: Very few such firms are public.
The year is young but already MBS and ABS deals are being prepped. Meanwhile, the mortgage market is waiting to see the FHFA’s capital proposal for Fannie and Freddie.
Its collateral has been performing well, but questions have been raised about Sterling Bank’s non-QM effort. For now, the program has been suspended but the depository is vowing a return.
Provident Funding is set to issue a non-agency MBS with standard mortgages eligible for sale to the GSEs. An affiliate of Cerberus is also planning a relatively large deal backed by seasoned mortgages.
The market for MBS with non-qualified mortgages is growing by leaps and bounds. However, there is some skepticism about whether there’s enough demand to support $50 billion in annual issuance.
Deal volumes in the non-agency MBS market are elevated as issuers work to meet investor demand. Angel Oak, Chase and Invictus are bringing large deals and more issuance is in the pipeline.
Noting that not a single SEC-registered non-agency MBS has been issued since disclosure requirements were tightened in 2014, the regulator is planning to revisit the standards.
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