Six expanded-credit MBS hit the market in the past two weeks, including the largest deal since COVID upended the sector. Activity is much slower in the space for prime jumbos and GSE-eligible investment-property loans.
A look at the performance of investment-property loans reveals some differences between GSE-eligible loans and non-agency mortgages. Performance also differed from owner-occupied prime jumbos and non-QMs.
UWM offering bank statement mortgages; Spring EQ expands HEL guidelines; Toorak issues bridge loan securitization; non-QM impairments steady in January; new law to help with LIBOR-linked legacy deals.
Aggregation of non-agency mortgages isn’t generating the types of returns seen in 2021, but it’s still a good business, according to officials at MFA Financial.
AG Mortgage Investment Trust acquired $2.5 billion of non-agency loans last year, about half of them during the fourth quarter. The REIT is targeting returns of around 15% from non-agency MBS issuance.
Western Asset Mortgage Capital took a third consecutive loss during the October-December period as it works to shift its investment focus to non-QMs and other non-agency products.
Goldman Sachs is set to issue its first expanded-credit MBS, with four other firms also offering deals in the past two weeks. In the prime non-agency space, JPMorgan Chase has another large offering.
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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