Select Portfolio Servicing added nearly twice as much servicing from just-issued non-agency MBS in the fourth quarter as it did in the third. Shellpoint remains the largest servicer of recently issued non-agency MBS. (Includes data chart.)
Non-agency mortgages, both jumbos and non-qualified mortgages, look promising to Western Alliance Bank as margins on conventional-conforming loans compress and production falls.
Milo Credit is offering a mortgage that allows borrowers to qualify solely by pledging Bitcoin. The lender’s asset treatment of Bitcoin varies significantly from how the GSEs view borrowers with cryptocurrencies.
The first non-agency MBS issued by a Community Development Financial Institution includes loans that didn’t require verification of borrower income or employment.
Mortgages in the transaction were acquired by Western Alliance Bank on a correspondent basis and will remain on its balance sheet. Risk-sharing deals in the non-agency market are rare and largely involve megabanks.
Prospects for non-agency MBS issuance in 2022 look mixed, with expanded-credit activity expected to increase while volume involving non-agency jumbos and GSE-eligible loans could decline.
Western Asset Mortgage Capital plans to shed investments in commercial mortgages and shift to residential assets, including non-QMs. The REIT was taking losses on commercial investments.
In a familiar refrain, participants in the non-QM market suggest the sector is ready for takeoff. Still, technology in the non-QM market lags compared with the GSEs.
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