Volume 2014 - Number 41
October 30, 2014
Underwriting, Compensating Factors Seen as Key For Limiting Risk When Originating Non-QMs
While originations of loans that don’t meet standards for qualified mortgages can subject lenders to increased liability, underwriting and compensating factors can help limit risks from non-QMs, according to Moody’s Investors Service. “Non-QM loans typically carry higher default risks than QM loans, but lenders can mitigate those risks by originating loans with attributes that compensate for the weaknesses that put the loans outside of the QM guidelines,” analysts at Moody’s said in a report published late last week. The rating service said...
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