Non-QM rates are now north of 7% in many cases, but the market is still dealing with upwards of $5 billion in lower-coupon product that needs to be moved.

After a two-week lull in issuance of jumbo MBS, a handful of deals hit the market. MBS issuers are facing weak demand from investors, with whole-loan outlets often offering better pricing.

Rising interest rates and widening spreads are prompting more investor-friendly changes to expanded-credit MBS deals.

While investors in fix-and-flip and other business-purpose loans are taking a closer look at loan characteristics and lenders’ practices, lenders are adjusting and considering locking in longer-term financing.

Sprout isn’t returning media inquiries these days, but chatter is spreading about $200 million worth of non-QM loans it was trying to place.

Issuance of expanded-credit MBS slowed in April after a surge in the first quarter. Rising interest rates played a role in both moves.

In the secondary market, issuers have had to deal with diminished demand for mortgage products originated prior to the recent runup in interest rates. Is the worst behind the sector?

Most companies that issued non-agency MBS with GSE-eligible investment-property loans during the fourth quarter haven’t offered similar deals thus far in 2022.

Spreads on MBS involving non-qualified mortgages have widened due to rising interest rates and excess supply. However, demand is on the rise again as new buyers are entering the space.

Spreads on non-agency MBS issued early this year were wider than the pricing seen near the end of 2021. Industry participants witnessed volatility in the broader financial markets along with an increase in the supply of non-agency MBS.