Hedging could lessen the shock of prepayments for large banks holding mortgage servicing rights. There aren’t similar offsets, though, to mitigate a surge in defaults, according to research from the Fed.

Without much relief in sight for borrowers’ pockets, the industry expects growth in non-agency securitizations from loans priced with higher risk premiums by Fannie Mae and Freddie Mac.

The trade group said a single-pull credit report is enough, if there are proper guardrails in place to prevent lenders and borrowers from “gaming the system.”

Issuers are increasingly delivering GSE-eligible owner-occupied mortgages to non-agency MBS in a bid to diversify liquidity.

The government-sponsored enterprises and Ginnie Mae have requirements that keep many community development financial institutions out of the mortgage business, according to CDFIs.

Analysts at the Urban Institute called for changes at the GSEs and FHA to make adjustable-rate mortgages more attractive for borrowers.

Experts speaking at SFVegas this week think the White House's interest in removing the GSEs from conservatorship could be dwindling.

Pete Mills, a senior vice president at MBA, believes housing affordability initiatives are more likely to come from executive orders this year.

President Trump’s directive to lower interest rates helped spur a tightening in mortgage spreads, but economists are skeptical of the long-term impact of the move involving GSE purchases of MBS.

Non-agency lenders are expecting an increase in originations following the Trump administration’s announcement that the GSEs will add $200 billion to their MBS holdings.