Private credit has moved from the margins to the mainstream of housing finance.
Non-agency residential mortgage-backed securities, which are supported by loans from private lenders rather than banks, have shown remarkable resilience in a high-rate environment. These securitizations depend on the credit quality of borrowers, the underlying property, and disciplined structures that continue to attract institutional capital seeking yield.
Chart: Trends
Through 2025, non-QM loans remain the largest source of issuance. Their performance reflects a healthy mix of borrower demand that falls outside the agency credit box and investor appetite for assets with strong underwriting and predictable returns. Issuance peaked in mid-year as rate conditions briefly steadied, underscoring the sector’s role as a flexible funding channel when traditional liquidity tightens.
The residential transition loan (RTL) securitization market, which includes short-term construction and bridge financing, has matured significantly since its early pilots in 2018. Securitizations exceeded seven billion dollars in 2024, marking a transition from experimentation to disciplined institutional growth. The capital now flowing into this space favors originators with scale, transparency, and servicing strength over high-yield opportunists.
For borrowers, the implications are direct. As investors concentrate their capital with proven lenders, the cost of funds stabilizes and execution improves. Builders and developers working with experienced private lenders such as i Fund Cities gain access to capital that is both reliable and efficient, allowing them to move quickly on new projects while maintaining financial control.
If rates hold steady and housing supply remains constrained, securitization volumes may expand modestly into 2026. Should volatility persist, growth may plateau, but capital will continue to consolidate around trusted operators. Either way, the market’s evolution favors borrowers who partner with lenders grounded in credit discipline and long-term performance.
If you have a fix and flip, rental, or new construction property that you are looking to fund, we are here to help!