Structured Credit Investor SCI’s 5th Annual Capital Relief Trades Seminar 17 October 2019, London
LOGIN
 

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).


  • REIT reduces RMBS footprint

    Five Oaks Investment Corp disclosed in its latest 8K filing that it has reduced the aggregate capaci...

    News Round-up    5 August 2016
  • MBS vet joins Nathan Hale

    Nathan Hale Capital has boosted its capital markets division with the appointment of Kurt Weisenfluh...

    Job Swaps    5 August 2016
  • RMBS compare tool debuts

    Fitch has introduced a data comparison tool for US RMBS, which encapsulates all of its US residentia...

    News Round-up    5 August 2016
  • COLT confidence

    Rated non-prime RMBS shifts market dynamics

    The issuance of Lone Star Fund's COLT 2016-1 in June marked a turning point for the US non-prime RMB...

    News Analysis    5 August 2016
  • Demand expected for jumbo Hawksmoor

    Initial price thoughts have been released for the first post-Brexit UK non-conforming RMBS, Hawksmoo...

    News    4 August 2016
  • Spanish NPL portfolios purchased

    Bain Capital has acquired three Spanish NPL portfolios for €1.15bn, extending the firm's h...

    News Round-up    4 August 2016
  • PACE acceptance is 'ABS positive'

    The Federal Housing Administration (FHA) and Department of Veterans Affairs (VA) are to being to ins...

    News Round-up    3 August 2016
  • Condominium price surge 'positive'

    Moody's says that rising condominium prices is positive for Japanese RMBS as it will increase recove...

    News Round-up    3 August 2016
  • RFC issued on PO strip ratings

    S&P is requesting comments on its proposed approach for the surveillance of ratings...

    News Round-up    3 August 2016
  • Aussie metrics approach crisis levels

    Delinquencies for Australian auto loan ABS and prime RMBS have risen steadily over the five months t...

    News Round-up    3 August 2016
  • Pay-outs prompt potential upgrades

    S&P has placed 310 classes from 111 US RMBS deals on credit watch with positive implications...

    News Round-up    2 August 2016
  • Loss risk improves for GSE CRTs

    Expected mortgage losses on seasoned GSE CRT transactions are trending positively, says Fitch. The l...

    News Round-up    2 August 2016
  • SCI Start the Week - 1 August

    A look at the major activity in structured finance over the past seven days. Print last week's news ...

    Pipeline The final week of July brought six new ABS deals to the pipeline, as well as two CMBS and...

    News    1 August 2016
  • REIT cuts securitisation business

    The board of directors of Two Harbors Investment Corp has approved a plan to discontinue the company...

    Job Swaps    29 July 2016
  • Korean issuance slows down

    South Korean ABS issuance in 1H16 was down year-on-year by 43.9%, with a total figure of just Won27t...

    News Round-up    29 July 2016
  • Single-family rents rising

    Tenant demand for US single-family properties remains robust, with rent increases in securitised pro...

    News Round-up    28 July 2016
  • GSE loan data released

    Fannie Mae has released historical loan performance data in support of its reperforming loan securit...

    News Round-up    28 July 2016
  • Foreign policy

    US agency MBS picking up European, Asian demand

    A surge in foreign interest in US agency MBS over recent months is adding a broader dynamic to the s...

    News Analysis    27 July 2016
  • Mortgage portfolio acquired

    Delta Lloyd Leven has purchased a €500m portfolio of Dutch whole loans from Rabobank. The...

    News Round-up    27 July 2016
  • Debut sale for structured loans

    Freddie Mac has completed its first-ever structured loan sale following the auction of a US$198.9m p...

    News Round-up    27 July 2016
  • MSR portfolio sold

    First South Bank has purchased a US$84.6m mortgage servicing rights portfolio from Freddie Mac and F...

    News Round-up    26 July 2016