Credit Enhancement Levels on New Jumbo MBS Vary Based on Factors Beyond Loan Quality
April 24, 2015
Issuers continue to include super prime mortgages in jumbo MBS but credit enhancement levels on the latest batch of deals vary widely, with rating services raising concerns about participants with limited track records, among other issues. Presale reports have been issued for four jumbo MBS in April thus far: a $241.06 million deal from Two Harbors Investment, a $267.19 million MBS from Five Oaks Investment, a $356.45 million deal from Redwood Trust and a $273.62 million Credit Suisse securitization. The underwriting for mortgages backing these deals is...