{"id":2919,"date":"2026-06-09T15:02:34","date_gmt":"2026-06-09T20:02:34","guid":{"rendered":"https:\/\/newviewadvisors.com\/commentaries\/?p=2919"},"modified":"2026-06-09T15:02:34","modified_gmt":"2026-06-09T20:02:34","slug":"hmbs-may-2026-part-ii","status":"publish","type":"post","link":"https:\/\/newviewadvisors.com\/commentaries\/2026\/06\/09\/hmbs-may-2026-part-ii\/","title":{"rendered":"HMBS May 2026 Part II"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">Total HMBS payoffs in May were 0.6% lower than April; the 1-mo prepayment speed for May was 15.6% compared to April\u2019s 16.2%. Outstanding HMBS decreased by $22.8 million to $56.20 billion, the 35th decrease in the last 40 months. The decline in HMBS understates the true story in outstanding HMBS and HECMs because negative amortization of underlying HECM loans mitigates dropping HMBS balances. While HMBS balances declined 1.9% and 3.6% over the last one and two years respectively, loan count dropped 6.2% and 12.4% over those same timeframes. The outstanding HMBS population in May 2021 included 309,910 HECMs; as of May 31st there were 240,316.<br><br>Finance of America is the issuer of record for $18.2 billion or 32% of all outstanding HMBS, having replaced Ginnie Mae as the largest portfolio in 2024. Along with Longbridge and PHH, the top four issuers of record account for 87% of outstanding HMBS. Onity (formerly PHH) recently announced the sale of its portfolio to Finance of America \u2013 together they account for 48.0% of outstanding HMBS.<br><br>\u201cGinnie Mae \u2013 Reverse Mortgage Funding 42\u201d remains as issuer of record for 3,882 former RMF pools. About $230 million of Issuer 42\u2019s portfolio paid off in May, but Issuer 42 still accounts for $11.3 billion, or 20% of all outstanding HMBS. Issuer 42 has not issued any tail pools; we estimate Issuer 42 still has an uncertificated position of over $1 billion, that is, the excess of their portfolio\u2019s HECM asset balance over the balance of their HMBS liability.<br><br>When a HECM loan balance reaches 98% of its MCA, the HMBS issuer is required to buy the loans out of the HMBS pool and then assign the loan to HUD if the loan is not in default. This is effectively a prepayment event for the HMBS investor, even though the underlying HECM loan remains outstanding. According to our friends at <a href=\"https:\/\/www.recursionco.com\">Recursion<\/a>, payoffs last month due to Mandatory Purchases were $380 million. Mandatory Purchases have averaged $422 million over the last 24 months.<br><br>New View Advisors compiled this data from publicly available Ginnie Mae data as well as private sources.<br><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Total HMBS payoffs in May were 0.6% lower than April; the 1-mo prepayment speed for May was 15.6% compared to April\u2019s 16.2%. Outstanding HMBS decreased by $22.8 million to $56.20 billion, the 35th decrease in the last 40 months. The decline in HMBS understates the true story in outstanding HMBS and HECMs because negative amortization [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[],"class_list":["post-2919","post","type-post","status-publish","format-standard","hentry","category-hmbs"],"_links":{"self":[{"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/posts\/2919","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/comments?post=2919"}],"version-history":[{"count":2,"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/posts\/2919\/revisions"}],"predecessor-version":[{"id":2922,"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/posts\/2919\/revisions\/2922"}],"wp:attachment":[{"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/media?parent=2919"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/categories?post=2919"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newviewadvisors.com\/commentaries\/wp-json\/wp\/v2\/tags?post=2919"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}