After issuing two jumbo mortgage-backed securities in 2017 on a shelf created by Credit Suisse, an affiliate of AIG Asset Management is launching a deal on its own. Pearl Street Mortgage Company 2018-1 looks a lot like previous AIG deals save for the change in shelf registration. However, the planned $446.17 million issuance will have somewhat higher credit enhancement on the senior tranche than the other MBS. The new issuance received preliminary AAA ratings from Fitch Ratings and ...

Embrace Home Loans hired a former official from Deephaven Mortgage to serve as director of mortgage product innovation. Deephaven has focused its correspondent production on non-qualified mortgages while Embrace is looking to expand its retail products. Parkes Dibble, the new hire, was previously a vice president of capital markets product development at Deephaven. Embrace said Dibble will lead efforts to strengthen the “depth and breadth” of ... [Includes two briefs]

Prices for jumbo mortgages softened near the end of 2017 and then markedly improved in the first two months of this year, according to officials at Redwood Trust. “As they often do, market conditions rebounded in January and we took full advantage,” Dashiell Robinson, an executive vice president at Redwood, said this week during the real estate investment trust’s earnings call. The company priced five non-agency mortgage-backed securities in January and February at much better execution ...

Plans at Wells Fargo to issue non-agency mortgage-backed securities in 2017 didn’t come to fruition. But growth limitations recently placed on the bank by the Federal Reserve have prompted speculation that Wells could issue non-agency MBS this year. This month, the Fed issued a cease and desist order that temporarily limits the firm’s maximum total consolidated assets to the level they were as of the end of 2017. The order was one of the last acts of former Fed Chair Janet Yellen, who ...

Ellington Financial is looking to ramp up activity involving non-qualified mortgages after a positive reception for its first mortgage-backed security. In November, Ellington issued a $141.2 million MBS predominantly backed by non-QMs. The deal closed with “excellent execution and strong investor demand,” according to Laurence Penn, president and CEO of Ellington. Investors included Putnam Investments, Janus Henderson Investors and JPMorgan Asset Management. “We had a ...

The nonprime mortgages held in portfolio by the government-sponsored enterprises continued to decline in 2017, according to an analysis by Inside Nonconforming Markets. And while the GSEs sold vintage non-agency mortgage-backed securities during the year, pre-crisis Alt A mortgages guaranteed by Fannie Mae and Freddie Mac are largely running off instead of being sold. Fannie and Freddie had a total of $108.23 billion in nonprime mortgage holdings ... [Includes one data chart]

S&P Global Ratings released a revised methodology and assumptions this week for non-agency mortgage-backed securities issued in 2009 and later. The revision included slightly more favorable treatment of mortgages to multiple borrowers and recalibrated loss severity assumptions, including an over/undervaluation framework that incorporates property values in markets compared with price-to-income ratios. New Penn Financial loosened ... [Includes two briefs]

The jumbo mortgage-backed security market received a boost this week as a new issuer stepped into the ring. Teachers Insurance and Annuity Association of America is preparing to issue a deal this month, according to presale reports. TIAA, a multi-faceted enterprise with more than $1 trillion in managed assets, acquired EverBank in 2017 and rebranded the operations as TIAA, FSB. The bank is set to issue a $381.54 million jumbo MBS using EverBank’s MBS shelf registration ...

The delinquency rate on non-qualified mortgages in mortgage-backed securities remains low, as issuers are largely avoiding risk-layering. As of the end of 2017, the average current-to-delinquent roll rate for non-QMs in MBS seasoned for one year was 0.4 percent, according to Bank of America Merrill Lynch. Only three non-QM loans tracked by CoreLogic have liquidated so far, and none realized a loss. Non-QM MBS have thicker credit enhancement than ... [Includes one data chart]

A new expanded-prime mortgage-backed security from Redwood Trust is nearly 40.0 percent larger than the prior deal from the real estate investment trust. Redwood is set to issue the $444.29 million Sequoia Mortgage Trust 2018-CH-1, following a similar $320.30 million deal in November and a $307.64 million deal in September, the first from Redwood to focus on loans from the firm’s Choice program. Choice mortgages have slightly wider underwriting standards than ...