Securitization of home equity loans increased again in the first quarter, driven by closed-end second liens. Issuance is growing exponentially, helped by nonbanks and investor demand. (Includes two data tables.)

The Structured Finance Association, which is developing a compliance tool to facilitate uniformity in the non-agency MBS market on QM standards, has run into a vexing issue regarding the definition of a QM.

The diversification inherent in MBS may be the ideal tool to combat climate risk in housing finance.

Ratings for MBS with residential transition loans are helping to increase investor demand.

Morningstar DBRS assigned a preliminary A rating to the deal that includes 370 short-term loans with a principal balance of $158.4 million.

A New York Federal Reserve study found that the secondary market loan sales could help boost capital at CDFI-approved lenders.

Nonbanks are fueling securitization of home-equity lines-of-credit, closed-end second liens and home equity investments. Issuance jumped in 2023 as refi business dried up. (Includes two data tables.)

Prime MBS issuance was up 15% from the third to the fourth quarter, while ECM production faded 15%. The sole growth market in 2023 was home-equity loan securitization. (Includes three data tables.)

Three non-agency MBS hit the market this week and more deals are in the pipeline.

Securitization rates increased for GSE-eligible loans, government-insured mortgages and non-agency mortgages. While bank demand for jumbos is declining, the vast majority of the loans don’t go into MBS. (Includes data table.)