A new model sale and servicing agreement is expected to become the standard for mortgage bankers on whole loan sales.
The new agreement was adopted Tuesday by the Mortgage Bankers Association, according to an announcement today. The trade group said it expects the agreement to the become the standard for purchases and sales of whole loans that might be targeted for securitization.
The move was made as part of an ongoing initiative to raise liquidity and efficiency in the non-conforming residential mortgage market.
The agreement was developed with significant input from a variety of stakeholders and uses elements of existing whole-loan agreements. It will likely see further refinements this year and a process of regular periodic review going forward.
MBA Chairman John A. Courson noted in the statement that while the private label mortgage-backed securities market is nearly non-existent now, the model agreement will provide better understanding and transparency for investors when the market returns.
view model agreement
