Agency MBS fundamentals have been supported by a combination of elevated mortgage rates, limited refinancing incentives, constrained housing turnover and low net supply.
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.
Homebuilders reported a slight decline in incentive use in the second quarter, but still project incentives to remain elevated compared to historical average for the foreseeable future.