First Republic Bank and Flagstar Bank posted lower originations of jumbo mortgages in the first quarter on a sequential basis. However, lower interest rates are expected to boost production in the second quarter.
Efforts by the Trump administration and the FHFA to reform the government-sponsored enterprises will likely prompt more activity in the non-agency market. However, the devil is in the details.
LendingHome recently issued a $219 million asset-backed security with fix-and-flip loans originated by the firm; Reliant Bancorp, Brentwood, TN, launched a correspondent purchase program for non-qualified mortgages in March; Angel Oak Mortgage Solutions expanded its office space in Dallas and Atlanta.
Verus Mortgage Capital and Chimera Investment Corp. are both set to issue non-agency mortgage-backed securities backed solely by loans for investment properties. The types of mortgages in the two deals differ. Loans in the Chimera MBS were eligible for delivery to the government-sponsored enterprises, but that was not the case with the Verus deal.
Redwood Trust is developing an outlet for mortgages that differ somewhat from traditional whole-loan sales. Officials at the real estate in-vestment trust have been working on the effort for months but haven’t formalized anything yet.
Goldman Sachs is set to issue a non-agency mortgage-backed security stacked with jumbo loans eligible for sale to the government-sponsored enterprises. The deal will mark the bank’s return to the prime non-agency MBS market. The deal size is $230.60 million, according to presale reports published last week by DBRS and Moody’s Investors Service.
Industry participants are increasingly calling for the qualified mortgage “patch” to be addressed as part of broader efforts to overhaul the nation’s housing-finance sector.
Banks and thrifts increased their holdings of first-lien residential mortgages in 2018, according to a new analysis by Inside Nonconforming Markets. [Includes one data chart.]
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