If government support of the mortgage market is reduced – either gradually or immediately – and the private sector doesn't fill the void with investment capital, it could have dire consequences for housing and residential finance, according to a new analysis released by Redwood Trust.

The publicly traded REIT – the only company to issue a Jumbo security in almost two years – believes that if private investors do not step up to the plate, mortgage rates will rise, home prices will fall or stagnate, and some borrowers won't be able to get a loan.

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.