JMP Securities initiates coverage of fix-and-flip lender Sachem Capital; S&P Global Ratings agrees to pay a $2.5 million penalty to the SEC; NYSE approves Impac’s compliance plan.

The nonbank’s margin plunged to negative 110 basis points in the third quarter, compared to 14 bps in the April-June period and down from 287 bps in the third quarter of 2021.

The real estate investment trust for now is focusing on managing liquidity and protecting its capital structure. Angel Oak Mortgage purchased only $62.4 million of non-QMs in the third quarter.

The business-purpose lender is “intentionally” slowing originations. No big surprise given that the non-agency market overall isn’t doing well.

Two of the deals are backed by investor debt service coverage ratio mortgages. There is also a 100% HELOC transaction in the works.

Another non-agency player assuming a defensive position is Rithm Capital. The firm has cut loan-to-value ratios and tightened underwriting.

The REIT believes the best opportunities are in business-purpose lending. But higher rates and tighter underwriting will slow originations.

The losses were driven by negative asset marks and impairment of assets related to its soon-to-be-shut mortgage originations business.

It’s been a tough year for non-QM shops as lenders adjust to a new rate-driven reality. Company closings appear to be picking up, but some believe the worst of it might be over. The latest to cease originations: Athas.

Demand for non-QMs in the secondary market remains weak. Investors are concerned about the prepayment profile of the loans, among other issues.