#prepayment-risk

#prepayment-risk

Moody's data show that higher-leverage loans jumbo and conventional mortgages with debt-to-income ratios of 43.1% or higher now account for nearly 40% of new originations, up from about 20% in 2021. RMBS investors closely track delinquency rates which are expected to increase due to a weaker jobs market along with prepayment trends, when assessing risk. Amid declining rates and renewed refinancing opportunities, overall prepayments are expected to climb slightly, the analysts said.