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RMBS

Residential mortgage-backed securities, or RMBS, are bonds or notes created by securitisation that are backed by residential mortgages or residential real estate loans. RMBS originators are typically financial institutions that originate residential real estate or residential mortgage loans, including banks, building societies/savings & loans and mortgage finance companies. However, issuers could also include government-guaranteed securities issued following bank bailouts, such as TARP or TALF, and the Government Sponsored Enterprises Fannie Mae and Freddie Mac. To create residential mortgage-backed securities, or RMBS, institutions sell pools of their loans to a special-purpose vehicle, or SPV, which then sells the loans to a trust. The trust then repackages the loans as interest-bearing securities and issues them. This true sale of the loans to the SPV ensures that the RMBS is treated as bankruptcy-remote from the originator. Many different types of assets back RMBS, including prime, non-conforming, sub-prime, Alt-A (or Alternative-A), buy-to-let and single-family rental (SFR) mortgages. The financial crisis caused residential mortgage valuations to plummet, leading to severe losses/defaults in many RMBS transactions (and ABS CDOs), as well as efforts to begin modifying loan documentation and indeed the creation of many credit/dislocation/distressed opportunity/recovery funds to take advantage of opportunities in the RMBS sector. Post-crisis, the Government Sponsored Enterprises Fannie Mae and Freddie Mac have developed a credit risk transfer market, comprising synthetic RMBS structures (whereby the risk is transferred via CDS tranches).


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    Unusual UK BTL RMBS marketing

    Goldman Sachs is in the market with an unusual UK buy-to-let RMBS secured by properties owned primar...

    News    31 October 2019
  • SCI Capital Relief Trades Awards 2019

    Transaction of the Year: Syon Securities 2019

    Lloyds Banking Group’s synthetic UK RMBS Syon Securities 2019 was motivated by prudent ris...

    News    28 October 2019
  • Overcoming stigma

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    One sector that continues to be underserved by financial institutions post-crisis is land banking. A...

    News    28 October 2019
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    Market moves    25 October 2019
  • CRR amendments for NPEs recommended

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    Market moves    24 October 2019
  • Scalable and repeatable

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    News    24 October 2019
  • GACS structured

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    News    23 October 2019
  • Firm files Chapter 11

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    Market moves    22 October 2019
  • SCI Start the Week – 21 October

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    News    21 October 2019
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    News Analysis    18 October 2019
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    News    18 October 2019
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    Market moves    16 October 2019
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    CLO business announced AllianceBernstein has announced a new loan and CLO management business, hir...

    Market moves    15 October 2019
  • SCI Start the Week - 14 October

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    Market moves    11 October 2019
  • Co-founder to depart

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    Co-founder moves on BlueMountain’s co-founder and co-president Stephen Siderow is set to...

    Market moves    10 October 2019
  • Synthetic RMBS debut

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    JPMorgan Chase Bank (JPMCB) is marketing what is believed to be the first rated synthetic mortgage r...

    News    10 October 2019
  • Bank leaves CDS committee

    Sector developments and company hires

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    Market moves    7 October 2019
  • SCI Start the Week – 7 October

    A review of securitisation activity over the past seven days

    Transaction of the week RMF is marketing its first private RMBS backed by jumbo proprietary reverse...

    News    7 October 2019
  • Reverse mortgage RMBS prepped

    First post-crisis deal backed by newly-originated reverse mortgage loans markets

    RMF is marketing its first private RMBS backed by jumbo proprietary reverse mortgages loans and, acc...

    News    4 October 2019
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    Market moves    3 October 2019