The correspondent channel gained market share in the jumbo sector in the second quarter. The retail channel, though, remained the predominant source of jumbos, with strong competition in the channel among banks. (Includes data chart.)
Wells Fargo isn’t trying to be the largest player in the mortgage market. Instead, the bank plans to focus on wealthy borrowers and customers that already have a relationship with the bank.
Big banks boosted their appetite for jumbo mortgages in the past decade thanks to regulatory changes following the 2008 financial crisis, according to a new finding from the Federal Reserve Bank of New York.
The expanded-credit mortgage sector bucked the trend and increased production in the second quarter. While some lenders significantly boosted originations, others recorded sharp declines. (Includes data chart.)
Less-capitalized non-QM lenders struggled amid weak demand for the loans in the secondary market. Some firms are looking to take advantage of that weakness.
Non-QM lenders are regaining their footing as volatility in the secondary market recedes. And many potential non-QM borrowers are comfortable paying relatively high interest rates, helping to boost originations.
The non-agency market hasn’t lived up to the hype, according to Mat Ishbia of United Wholesale Mortgage, which saw a drop in non-agency lending. The overall sector, meanwhile, saw higher production and gained market share in the second quarter.
The Southfield, MI-based bank expects fixed-cost savings of roughly $3 million a year from using MortgagePath for originations and the vendor will be responsible for compliance issues.
The jumbo sector bucked trends in the broader mortgage market, with a 3.1% increase in origination volume in the second quarter. A handful of banks sharply increased their jumbo lending during that period. (Includes data chart.)