Castlelake, L.P. and Redwood Trust Inc. (NYSE: RWT) announced the formation of a joint venture to purchase up to $8 billion of prime jumbo mortgage loans through Redwood's Sequoia platform.

The partnership will focus on fully documented prime jumbo mortgage loans, with Sequoia handling sourcing, aggregation, and due diligence of loans meeting defined eligibility criteria. The joint venture includes flexibility to scale operations and acquire seasoned loans from bank balance sheets.

"Castlelake is pleased to partner with Redwood and its Sequoia platform to provide our investors with access to what we expect to be high-quality, fully documented prime jumbo assets," said Lucas Jackson, Head of North American Residential Mortgage Finance at Castlelake.

Brooke Carillo, Executive Vice President and Chief Financial Officer at Redwood Trust, noted that Sequoia has more than doubled its loan acquisition volumes over the past year as the company builds market share in the jumbo mortgage sector.

Redwood's Sequoia platform has operated as a non-agency correspondent platform since the company's founding in 1994. The platform has purchased approximately $100 billion of loans and securitized over $50 billion throughout its history.

Castlelake manages approximately $36 billion of assets and has acquired or financed more than $10 billion in residential and commercial loans since 2024. The firm operates as a strategic partner of Brookfield Asset Management Ltd.

The information is based on a press release statement from the companies.