Investor demand is expected to remain strong for agency MBS despite some volatility expected for the rest of the year.

Issuance of spec-pool MBS in the second quarter increased at a faster pace at Freddie than at Fannie. Pools of loans for Florida properties continued to be favored over loans from New York and Texas. (Includes data table.)

Issuers of ABS backed by data center assets need to expand their investor base as some approach concentration limits within their portfolios, according to the Kroll Bond Rating Agency.

Adoption of AI in underwriting could significantly reduce refinancing costs for small loans, eroding the prepayment protection low-loan balances have typically provided.

Fitch ratings found that early-stage delinquencies and cumulative default rates for consumer ABS deals are higher following a servicer bankruptcy or originator wind-down.

The average balance of loans in the new deal is $916,240, compared to $794,484 in Redwood’s March deal.

Securitization of consumer loans and credit cards saw huge gains from the first to the second quarter, helping ABS issuance set a new record. Stellantis was the top ABS issuer in the second quarter, while Bank of America ranked as the top underwriter. (Includes three data tables.)

The Trump administration has provided little guidance on how the GSEs will achieve their goal of purchasing $200 billion of agency MBS. Still, actions by Fannie and Freddie have helped competing agency MBS investors get comfortable with activity by the mortgage giants.

Bayview Asset Management recently issued two forward-flow deals, with the issuer adding to the pools during a prefunding period.

The Basel re-proposal from federal bank regulators includes provisions that would limit mortgage warehouse lending and securitization by banks, according to industry participants.