Reviving Private Label MBS: How and Why?

Posted To: MND NewsWire

In an earlier article we summarized the first part of a report by Urban Institute's Housing Finance Policy Center, Senior Fellow Jim Parrott about the failure of private label securitization (PLS) to recover after the housing crisis. He cites the lack of certainty in the system on the part of investors and a standardized structure that would ally the lack of trust as well as several economic conditions that weigh against a PLS return, including the lack of incentives and capital to repair the system. He says we are left with a Catch-22: "only with a strong market is it worth spending the time and money to take the steps necessary to create a strong market. Having set out the problem, Parrott suggests three steps to gradually build infrastructure needed for the PLS market to take off again....(read more)

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from Mortgage News Daily http://ift.tt/2hoQymr