Securitization

Delinquency trends split in Q3, with securitized and agency loans showing more strain while banks and life companies saw small improvements amid uneven vacancy and rent conditions.

Declining issuances since 2022 led to a request for information regarding the future direction of the reverse mortgage program, and NRMLA and MBA responded.

Mortgage bonds are on track to deliver their strongest returns in two decades, with the Bloomberg US Mortgage Backed Securities Index having gained 8.35% in 2025 through Friday.

Federal Reserve bank supervisors are monitoring community and regional banks' commercial real estate portfolios amid concerns over "lower commercial property values," the agency said. 

If cumulative loss or a delinquency trigger event is in effect, then the deal will distribute principal among the class A notes before any principal allocation the class M1 or class B certificates.

The transaction uses a shifting interest repayment structure, and its lockout that is subject to performance triggers.

New private-label bonds collateralized by loans made outside the qualified mortgage definition hit highs for the month, quarter and year, CreditFlow data shows.

A combination of factors, including the rise of retail investing and sound assets, propelled ETF formation, with at least four issuances over the past year.

The Structured Finance Association is adding its weight to recent support for a Securities and Exchange Commission action that could modernize Reg AB II.

SEMT 2025-12's collateral profile is slightly weaker compared with the prior transaction, with a slightly lower weighted average FICO score.

Second-lien mortgages make up the collateral pool. Those assets normally have a high expected loss severity, but the borrowers appear to be of prime credit quality.

Most of the pool of 1,011 residential mortgages, 69.7%, are considered non-prime mortgages, primarily due to the documentation and styles of underwriting.

Now that quantitative tightening is ending, the debate on who should be the MBS buyer of last resort, Fannie Mae and Freddie Mac, or the Fed, is taking hold

FFIN 2025-3's average loan balance, $16,366 was lower compared with the 2025-2 deal, when it was $19,993, and the WA interest rate on the current deal is 12.15%, down from 12.56%.

Mortgage groups want GSEs to buy MBS to lower rates, but the Chairman of Whalen Global Advisors writes that the plan is risky, unnecessary, and poorly timed.

Overall, new 60-day-plus delinquencies totaled $2 billion, up from $1.69 billion in August, while maturity defaults accounted for half, or 51% ($1.05 billion) of new delinquencies.

Karsten Giesecke and Michael Karol join Morriello to represent clients such as lenders and private equity funds in transactions including RMBS, CMBS, franchise loans and esoteric assets.

Rithm Capital, a real estate investment trust, is sponsoring the deal, in which property focused investor loans represent 32.60% of the collateral pool.

The NCUA, as liquidating agent for three failed corporate credit unions, sued in 2018 claiming U.S. Bank failed to perform its role as RMBS trustee.

FHFA's announcement has investors increasingly concerned about the Bozeman, Montana-based FICO losing both pricing power and a competitive edge.