Back to top

Image: Bigstock

Redwood Trust (RWT) Launches Home Equity Investment Platform

Read MoreHide Full Article

Redwood Trust, Inc. (RWT - Free Report) has launched its in-house home equity investment (“HEI”) origination platform, Aspire. With this, Redwood Trust significantly expands its presence in the residential housing market, tapping one of the largest addressable markets in the United States — residential home equity.

The company will be leveraging its nationwide correspondent network of loan officers and will establish direct-to-consumer origination channels to originate HEI through Aspire.

Markedly, since 2019, RWT has been a preeminent participant in the HEI market and has purchased around $350 million in HEI to date. It co-sponsored the first-ever securitization backed entirely by HEI in 2021 and arranged a $150 million dedicated HEI financing facility in 2022.

Aspire will cater to clients seeking traditional financing options, such as closed-end second-lien mortgages or home equity lines of credit, without the monthly payment feature of HEI. The move also underlines the company’s efforts to bring innovative solutions to the non-Agency housing market.

Per Christopher Abate, the chief executive officer of Redwood Trust, “We have been fortunate to work alongside a handful of HEI originators over the last few years, helping to bring liquidity and product development expertise to this emerging asset class. As we continue to invest in HEI through our third-party partners, Aspire will represent the natural evolution of our strategy, allowing us to address the needs of consumers we have long served through our Residential correspondent network.”

He continued, “When juxtaposing near-record high costs for traditional mortgage financing with record amounts of untapped equity in housing, our HEI product provides an attractive solution for many consumers who often qualify for additional home debt but prefer the flexibility of an equity investment. As we have demonstrated through Redwood’s past innovations, our products have the ability to align the interests of homeowners and investors on a scale not previously seen in the United States.”

Over the past six months, shares of RWT have gained 3.3% against the industry’s decline of 1.5%.

Zacks Investment Research
Image Source: Zacks Investment Research

Currently, Redwood Trust carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Business Expansion Moves by Other Companies

Apollo Global Management (APO - Free Report) has collaborated with Phoenix Holdings Ltd., a leading Israel-based insurance, asset management and financials group, for the deployment and co-investment of Phoenix client and corporate assets.

For Apollo, the agreement with Phoenix indicates its strategy of partnering with innovative insurance and financial institutions internationally to offer private fixed-income opportunities. In 2022, APO directly originated around $100 billion of assets, primarily senior, secured lending opportunities.

U.S Bancorp (USB - Free Report) subsidiary, Elavon, unveiled a next-generation platform, talech Terminal. The platform will assist small business owners in managing their operations without having to shell out a fortune to buy a new payments system.

Last year, U.S. Bancorp and Elavon launched talech Register as a next-generation integrated payments and business analytics platform. This was designed to enable small business owners to optimize their operations. Now, with the addition of talech Terminal, business owners can access a wider range of payment options.

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

U.S. Bancorp (USB) - free report >>

Redwood Trust, Inc. (RWT) - free report >>

Apollo Global Management Inc. (APO) - free report >>

Published in