Issuance of non-agency MBS fell 8.2% in the first quarter, with the decline driven by the expanded-credit sector. The non-agency MBS market essentially shut down in March due to fallout from the coronavirus. (Includes data chart.)
New Residential, Redwood and Two Harbors sold non-agency MBS holdings as REITs were hit with a surge of margin calls from their lenders. Efforts by the federal government to prop up the mortgage market haven’t done much for non-agency players.
Toorak prices securitization backed by bridge loans; Redwood extends a warehouse line; Velocity provides a financial update; sales of luxury homes rose in 4Q19; PCMA launches product for investment properties.
Presale reports for three deals backed by new originations were published this week. However, there’s uncertainty about how they will be received by investors due to market volatility related to the coronavirus.
Investors that are active in the market for non-QMs can’t seem to get enough of the loans or MBS. Meanwhile, large firms continue to avoid the sector due to concerns about liabilities and the lack of uniformity.