GSE-eligible mortgages for investment properties are reshaping the prime non-agency MBS market. The loans have somewhat looser underwriting standards than what’s typically seen on prime jumbos. (Includes three data charts.)
Many jumbo lenders are no longer looking to Appendix Q when originating loans. Instead, they have the option to underwrite loans using GSE automated underwriting systems and obtain QM status.
HEIs differ from reverse mortgages in that there’s no age limit and the borrower can still have a first mortgage. Separate HEI securitizations were recently issued involving Point and Unlock Technologies.
There’s plenty of non-agency MBS with GSE-eligible mortgages for investment properties, along with prime jumbo deals, expanded-credit mortgages and even some esoteric collateral.
The supply of mortgages for non-agency MBS is expected to decline, leading to concerns that industry participants might loosen underwriting standards to prop up volumes.
AGMIT sold off the last of its investments in commercial mortgages in September, with plans to increase investments in non-QMs and other non-agency mortgages.
The share of securitized non-QMs that are delinquent or modified increased in August for the first time since February. Still, industry analysts are comfortable with the long-term outlook for performance.
FHFA scraps plan to allow non-agency mortgages on common securitization platform; non-agency forbearance declines; Redwood makes another venture investment; Plaza resumes non-QM program; FoA allowing jumbo borrowers to use income from ADUs; Invictus hires dv01.
The creation of a U.S. sovereign wealth fund could grease the skids for an end to the conservatorships of Fannie Mae and Freddie Mac.
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