Economic Quarterly

This article examines those real estate investment trusts (REITs) that invest predominantly in mortgage-backed securities (MBS) and fund themselves with repurchase agreements (repos)---so-called mortgage REITS, or mREITs. mREITs grew quite rapidly after the financial crisis that began in 2008 and have come to be significant players in the MBS and repo markets. We review how they operate, how they are regulated, their recent growth, the risks they face, how they manage these risks, and the dangers they may pose to the broader economy.