Five expanded-credit MBS deals are due at the end of the second quarter. The issuers are Ellington Financial, New Residential, Seer Capital Management and affiliates of Caliber Home and Starwood Property.
An affiliate of Angelo Gordon is set to issue its first non-QM MBS with what could be a trend-setter: many of the loans were originated by a CDFI. Such loans are exempt from the ATR and risk-retention standards.
The latest expanded-credit MBS from Angel Oak will be somewhat smaller than the first two deals the firm issued this year. The deal also includes a higher share of mortgages underwritten with 12 months of bank statements.
Participants in the non-agency market are looking forward to the end of the “GSE patch,” anticipating significant increases in non-QM activity as long as federal regulators provide certainty regarding the rules of the road.
Carrington Mortgage Services is prepping its first MBS backed by non-qualified mortgages, which differ from loans in expanded-credit products from other issuers.
Expanded-credit mortgage originations declined for the second consecutive quarter at the end of March. Demand from borrowers was down but lenders remain optimistic about the sector.
An affiliate of Angelo Gordon plans to enter the non-agency MBS market with a deal backed by non-QMs. Western Asset Management priced one of the largest expanded-credit MBS and more deals are in the works.
A new REIT managed by PIMCO initially will focus on agency loans but has designs on the non-agency market as well. A $1.0 billion IPO for the REIT could be completed next week.
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