Fourth Non-Fannie/Freddie MBS Deal Since 2007 Imminent

Redwood Trust doesn’t have a monopoly on jumbo mortgage backed securities deals. Recently Two Harbors Investment Corp. and its partner Barclays Bank agreed on a May 17 deadline for the issuance of a new residential mortgage-backed securities deal, according to a filing with the SEC.

The two firms said in May they would be targeting a $250 million RMBS deal using a warehouse line to gather the jumbo mortgages.

Assuming this goes through, however, it would only be the fourth private-label (aka jumbo, aka non-Fannie/Freddie) RMBS offering since 2007. The other three were done by Redwood.

Reportedly should Two Harbors, the seller in its deal, fail to deliver the security before May 17, Barclays, which is the initial purchaser, would agree to buy the assets. Two Harbors must obtain an AAA rating on the security from at least one ratings agency.

Don’t forget about possible risk retention rules—if they exist by then!