Average credit scores, DTI ratios and LTV ratios haven’t loosened much in the past two years as expanded-credit MBS issuance soared. The investment-property share of MBS issuance is also on the rise. (Includes three data charts.)
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.
The CFPB is considering eliminating the DTI ratio metric when determining the QM status of a mortgage and instead basing the designation on the interest rate. The proposal was met with mixed reactions.
Presale reports for five prime non-agency MBS have been published in the past two weeks, including two deals from JPMorgan Chase. Many of the loans were funded by nonbanks and are eligible for sale to the GSEs.