The non-qualified mortgage sector has exhibited significant performance pressure over the past two years. The sector has not yet faced material losses, though.
Production of adjustable-rate mortgages declined slightly during the third quarter of 2025, but were up 40.7% through the first nine months of the year.
Joel Berner, a senior economist at Realtor.com, said renovated homes still catch buyers’ attention, but financing the cost of those improvements at today’s rates is less appealing to price-sensitive shoppers.