One after another, nonbanks are lining up to reduce the size of their master repurchase deals or cut the credit entirely. Message: The mortgage boom is over.
A weak origination market is fueling reduced activity on MBS trades. Still, some view MBS as a safe haven of sorts, especially with the equities market reeling.
Servicing sales remain brisk but there’s been a deal slowdown of late and more discriminate buyers. Meanwhile, new Ginnie Mae capital rules could rock the boat further.
As nonbanks go, so too goes the warehouse lending sector. Enough said on that score. The second quarter brought additional deterioration in commitment levels. (Includes data chart.)