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Investments

Delinquency rate on private RMBS is nonexistent

Just two of 20,000 since 2010 are delinquent

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If there were ever a sign credit requirements may be tight, this is it.

The delinquency rates on recently issued U.S. RMBS are almost nonexistent almost four years after the first post-housing crisis deal was signed, Fitch Ratings says in its new U.S. prime jumbo RMBS monthly trends report.

There have been about 20,000 loans securitized since January 2010, and of those only two loans are currently over 60 days delinquent.

When loans that are only one payment behind are included, the total delinquency as a percentage of the remaining loans is only 18 basis points.

‘The exceptionally strong credit performance for post-crisis RMBS reflects the unusually high credit quality and tight loan underwriting of the mortgage pools,’ said Grant Bailey, managing director at Fitch.

Volatile prepayment behavior has also been a distinguishing characteristic of the recent transactions. 

After spiking to annualized prepayment rates above 60% in 2012, most transactions are currently prepaying at rates below 10%.

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