For investors willing to shift from the agency MBS market into non-agency deals, the flow of GSE-eligible mortgages in non-agency MBS looks like a good proposition. Lenders, meanwhile, are taking a hit on pricing.

Chase issued another prime non-agency MBS with a balance topping $1.0 billion. The firm also issued an investment-property deal while Lone Star offered an expanded-credit MBS.

MISMO and SFA are separately working to update the ASF dataset for non-agency MBS; BNY Mellon is offering new agency MBS service; a relatively rare downgrade for commercial MBS.

A new expanded-credit MBS from Angelo Gordon includes loans that won’t be subject to third-party reviews until after closing. Due diligence firms are swamped due to a boom in non-agency MBS issuance.

The lender curtailed its jumbo lending in the early days of the pandemic. Now, jumbos account for a growing share of United Wholesale’s production and the firm is issuing non-agency MBS.

In the past two weeks, $2.74 billion of non-agency MBS were gobbled up by investors. GSE-eligible mortgages for non-owner-occupied properties accounted for half of the dollar volume in the deals.

Thanks to restrictions placed on the GSEs, investment-property mortgages are flowing into non-agency MBS. Some lenders are issuing deals on their own while others are turning to aggregators like Credit Suisse.

The recently public real estate investment trust focuses nearly all of its investments on non-QMs originated by affiliated lenders.

Angelo Gordon Mortgage Investment Trust expects returns as high as 18% from securitizing non-QMs. The REIT and others are working to increase their acquisitions of the loans.

The three servicers added significant volume to their portfolios thanks to the surge in non-agency MBS issuance during the second quarter of 2021. The performance of securitized loans also continues to improve. (Includes data chart.)