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Can Non-Agency Residential MBS be used as collateral?

April 26, 2017collateral MBS non-agency Residential Used

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Can Non-Agency Residential MBS be used as collateral?

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Publicly offered non-agency residential mortgage-backed securities (MBS) that represent an unsubordinated interest in cash flows from pools of 1-4 family residential properties are eligible collateral for FHLB advances. Subordinate tranches may be eligible as Category 5, Other Real Estate Related Collateral. Non-agency residential MBS collateral is subject to individual review and acceptance by the Bank. Private placements, IO strips, and PO strips of any security typically are not eligible as collateral. Please contact the Collateral Department at 617-292-9729 if you are interested in pledging non-agency residential MBS as collateral, or if you have questions regarding whether a particular security is eligible as collateral.