The Urban Institute's Housing Finance Policy Center has just released a new note: The Rebirth of Securitization: Where is the Private-label Securitization Market?
In her brief, Center Director Laurie Goodman explains why the private-label residential mortgage-backed securities market remains stagnant.
She also explores why this is problematic and what needs to happen to re-invigorate this critical piece of housing finance.
Here’s the abstract:
In the wake of the financial crisis, new securitization activity ground to a halt in all asset classes that did not have an implicit or explicit government guarantee. Though securitization has since resumed in most asset classes, including automobiles, credit cards, collateralized loan obligations (CLOs), and commercial mortgage-backed securities (CMBSs), the private-label residential mortgage-backed securities market remains stagnant. In this brief, we discuss why the residential mortgage market experience has been so different and provide guidance about what remains to be fixed.
Read the whole thing here.