"In regard to credit performance for these pools, delinquencies of 30 days or more ended the third quarter at 5.65%, little changed from the second quarter but 33 basis points higher than a year earlier. Prepayment activity also ticked up, with conditional prepayment rates reaching 14.1% as conventional mortgage rates eased into the low- to mid-6% range and non-QM weighted-average coupons declined to the mid-7% range."
"Deal-level performance remained largely stable. Credit enhancement continued to build as losses stayed low. Industry analysts said the sector's performance was influenced by a stalled macroeconomic environment as the unemployment rate rose to 4.3% in August, the highest since 2021. The rate is still relatively low by historic standards, compared with 4.1% at the end of the second quarter."
"Inflation held steady at an annualized rate of 2.78%, based on the headline Consumer Price Index. Housing market activity remained subdued. Existing home sales held slightly above 4 million units on an annualized basis, similar to last year but still at historically low levels. New home sales showed modest improvement from the previous quarter and year, although full September data was not yet available. Conventional mortgage origination volumes were largely in line with the same period in 2024."
Delinquencies of 30 days or more ended Q3 at 5.65%, little changed from Q2 but 33 basis points higher than a year earlier. Conditional prepayment rates rose to 14.1% as conventional mortgage rates eased into the low- to mid-6% range and non-QM weighted-average coupons declined to the mid-7% range. Deal-level performance remained largely stable and credit enhancement continued to build as losses stayed low. Unemployment rose to 4.3% in August, while GDP rebounded from a 0.6% Q2 decline to a 3.8% Q3 gain and inflation held near 2.78%. Housing activity remained subdued; existing sales near four million and new sales showed modest improvement. Non-QM RMBS structures exhibited resilience.
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