MAXEX, the first digital mortgage exchange to enable financial institutions to buy and sell residential loans through a single clearinghouse, has exceeded $5 billion in lock trading volume as of December 31, 2019.
MAXEX was launched in 2016 via a commercial partnership with J.P. Morgan to simplify the complex process of trading residential loans in the $10+ trillion secondary mortgage market. Since then, more than 100 bank and non-bank lenders, as well as more than 15 market-leading investors, including Wall Street dealers, money center banks and the largest real estate investment trusts in the U.S., have been approved to buy and sell mortgage loans on MAXEX. Trading volume more than doubled in the second half of 2019 as compared to the first half of the year.
“MAXEX set out several years ago with the ambitious objective of solving many of the problems that caused the 2008 financial crisis and collapse of the U.S. housing market,” said Tom Pearce, CEO and Chairman of MAXEX. “Years of hard work on the part of the MAXEX team, our investors and our customers have enabled us to do something that has never been accomplished before, and we are now bringing massive efficiency to the largest credit market in the world.”
“MAXEX is the first mortgage exchange to successfully have its loans securitized. The market’s confidence and trust in MAXEX is rapidly increasing as evidenced by its loans having now been securitized across 37 private mortgage-backed security transactions with many more on the horizon each month,” said Bill Decker, President of MAXEX.
The key to MAXEX’s growth is the company’s ability to simplify secondary market trading by overcoming barriers in three important areas:
- One counterparty: MAXEX has created a single, proprietary clearinghouse, which serves as the central counterparty to each side of the transaction.
- One contract: All MAXEX buyers and sellers have agreed to a single, standardized trading agreement.
- One digital exchange: MAXEX enables buyers and sellers to execute trades via an easy-to-use cloud-based platform.
MAXEX has solved many of the market’s complexities that have prevented prior mortgage exchanges from succeeding. Its digital platform enables loan buyers and sellers to obtain consistent liquidity at optimal price execution by providing access to multiple trading partners, reducing costs and mitigating risk.