The "patch" that provided QM status to every mortgage eligible for sale to the GSEs is no longer in effect.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.

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.

Lock volume for planned acquisitions of jumbo mortgages declined in the second quarter at Redwood Trust. Still, officials are optimistic about growth in the non-agency market.

Nearly 70% of the non-QMs originated in 2020 included an IO term, according to a new INM analysis. The top two lenders were banks. (Includes data chart.)

Churchill Real Estate launched a table funding option, Toorak a securitization and Sachem raised $43 million via a stock sale. Meanwhile, the fix-and-flip market was on the decline in the first quarter.

While many non-QM lenders suspended production last year, A&D Mortgage’s direct connection to the MBS market placed it in good stead.

Originations of adjustable-rate mortgages declined by 15% on a sequential basis in the first quarter of 2021. The ARM share of total originations also fell below 5%. (Includes data chart.)