Wells Fargo is set to issue its first expanded-credit MBS. Loans in the deal have seasoned for an average of 15 months and other issuers are prepping MBS with somewhat seasoned mortgages.
IO lending among a group of 15 prominent lenders increased by 35.3% in the second quarter. Banks accounted for nearly all of the increase. (Includes data chart.)
The impairment rate on non-QM MBS declined to 19.3% in July from 20.4% in June. While loan performance is improving, MBS investors could suffer reduced cash flows and losses as modifications end.
The majority of loans in Goldman's MBS were included in deals issued in 2017 and 2018 that were subsequently collapsed. Angel Oak, Chase and MFA also issued MBS within the past two weeks.
MFA was one day away from pricing its first non-QM MBS in March when volatility from the coronavirus struck. Result: deal scuttled but there's a happy ending: the REIT finally issued its first non-QM MBS this week.
Thousands of non-qualified mortgages could receive safe-harbor status three years after origination under a new “seasoning” provision proposed by the CFPB.
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