Mortgage production increased by 26% in the second quarter on a sequential basis at the jumbo-focused First Republic Bank. And lock volume declined by 15% at Redwood.

With lending volumes expected to increase, numerous non-QM lenders are working to add employees. New products are also being offered.

The "patch" that provided QM status to every mortgage eligible for sale to the GSEs is no longer in effect. With fewer incentives to originate mortgages that comply with GSE standards, lenders could boost non-agency originations.

Toorak Capital Partners expanded its securitization activities into 30-year mortgages for investment properties. Bayview Asset Management and Goldman Sachs have jumbo MBS in the market, and a number of other issuers are planning deals.

The impairment rate on securitized non-QMs fell to 7.9% at the end of May. Prepayments in the sector remain elevated as borrowers refinance.

As interest rates declined in 2020, the ARM share of jumbo originations plummeted. Lenders also got more lenient with DTI ratios, while average credit scores and LTV ratios tightened somewhat.

Non-agency forbearance ticks up; Saluda Grade raises capital; Sachem launches SPAC.

Trump-era GSE policies that helped boost activity in the non-agency market could be reversed as Biden appointees take charge at the FHFA.

The CFPB scaled back a proposed foreclosure moratorium and declined a request to exempt non-agency loans from the new standards.