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).


  • Wachovia claims settled

    Wachovia has agreed to pay US$53m to resolve NCUA claims arising from losses related to purchases of...

    Job Swaps    22 October 2015
  • Euro secondary still strong

    The European securitisation secondary market is continuing to see a strong BWIC calendar and market...

    SCIWire    22 October 2015
  • French true sale RMBS debuts

    Crédit Agricole has closed FCT Crédit Agricole Habitat 2015, a self-led retained s...

    News Round-up    21 October 2015
  • Default predictors identified

    In an analysis of default frequencies of both US agency and non-agency mortgage loans originated fro...

    News Round-up    21 October 2015
  • Euro secondary retains BWIC focus

    BWICs are continuing to dominate the European securitisation secondary market. Thanks in part to a...

    SCIWire    21 October 2015
  • DOJ lawyer moves on

    Geoffrey Graber has joined Cohen Milstein Sellers & Toll as a partner. He will be part of th...

    Job Swaps    20 October 2015
  • BTL rate buffers evaluated

    The prospect of increasing interest rates in the UK is prompting a re-examination...

    News Round-up    20 October 2015
  • Barclays settles with NCUA

    Barclays has agreed to pay US$325m to settle NCUA claims that it sold faulty RMBS. It is the latest...

    Job Swaps    20 October 2015
  • Euro secondary picking up?

    After a quiet start to the week, the European securitisation secondary market looks to be picking up...

    SCIWire    20 October 2015
  • SCI Start the Week - 19 October

    A look at the major activity in structured finance over the past seven days

    Pipeline Activity picked up last week as several deals joined the pipeline. These deals consisted o...

    News    19 October 2015
  • Euro secondary patchy

    Activity in the European securitisation secondary market remains patchy. Friday saw a slight dip i...

    SCIWire    19 October 2015
  • Peripheral calls to gain pace?

    The THEME 2 RMBS (with a mortgage factor of 7%) was called and the final distribution received this...

    News Round-up    16 October 2015
  • 'Swapless' Belgian RMBS prepped

    Belfius Bank is marketing Penates 5, the first Belgian RMBS to be publicly placed since the financia...

    News    16 October 2015
  • US RMBS turns positive

    The US non-agency RMBS secondary market has taken a turn for the positive. "It's been a relatively...

    SCIWire    15 October 2015
  • 'Unique' SFR parity feature debuts

    Colony American Finance's (CAF) latest deal is the first single-family rental (SFR) transaction to i...

    News    15 October 2015
  • RMBS arrears reach record low

    Australian housing loan arrears in August reached their lowest level for the prime RMBS sector since...

    News Round-up    15 October 2015
  • Countrywide IRS ruling received

    The IRS ruling on the Countrywide RMBS settlement has been received, making the approval date 13 Oct...

    News Round-up    15 October 2015
  • Euro secondary unchanged

    The European securitisation secondary market continues to see light flows and only pockets of activi...

    SCIWire    15 October 2015
  • TRS programme debuts

    Goldman Sachs and Sumitomo Mitsui Trust Bank are marketing the first series of notes from an unusual...

    News Round-up    14 October 2015
  • Spanish housing recovery 'uneven'

    Fitch reports that loss severities on Spanish mortgage foreclosures have continued to rise, despite...

    News Round-up    14 October 2015
  • Euro secondary consolidates

    Yesterday was primarily about consolidating recent gains in the European securitisation secondary ma...

    SCIWire    14 October 2015