The top five producers of jumbos continue to offer the mortgages. The production picture is less clear at nonbanks, which don’t have portfolio capacity.
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.
Non-agency loans account for about 30% of all residential mortgages outstanding and, unlike with servicing for the GSEs or government-insured mortgages, there’s no standardization in how servicers will respond to borrowers facing financial difficulties tied to the coronavirus.
Nearly all the firms in a group of 30 servicers increased their jumbo portfolio in 2019. Chase and Truist were the only ones to see a decrease. (Includes data chart.)
Banks and thrifts increased their holdings of residential first liens by 4.1% in 2019. Among the top 10 banks, three reduced their portfolios. (Includes data chart.)
Bank of America retained 94% of its mortgage originations in the fourth quarter of 2019, a much higher retention rate than other big banks. Officials at the bank said BofA’s loans offer better yields than MBS.
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