Near the end of April, Chase and Redwood were marketing large jumbo MBS. Also, Citi returned to the sector for the first time since 2014.

Redwood Trust nearly doubled its net income in the first quarter, helped by the quick aggregation and sale of jumbo mortgages.

Non-QM impairments decline; non-agency forbearance rate improves; non-agency reverse mortgage lender settles with CFPB; Redwood paying for its employees’ MI; PCMA partners with various advisors.

Prime non-agency MBS issuance continued to flow in April, helped by some new players. Expanded-credit activity has been limited recently, with a downturn in demand.

Non-agency lenders are waiting for a decision from the CFPB on standards for qualified mortgages. The CFPB wants to extend the QM patch, though the Trump administration threw a wrench in that plan.

Mortgage originations declined by 11% in the first quarter at First Republic while Redwood increased its lock volume by 21% from the fourth quarter.

An effort by the CFPB to delay the end of the QM patch is causing uncertainty for non-agency lenders. A coalition of lenders and consumer advocates said the CFPB shouldn’t move forward with the proposal.

AIG is set to issue a jumbo MBS with new production and MFA Financial has a non-QM deal with loans that have seasoned for 16 months. A surge of issuance also looks likely later this month.

The retail channel accounted for nearly 90% of jumbo mortgage originations last year. The channel gained share from both correspondents and brokers. (Includes data chart.)

Some lenders are originating jumbos under new QM standards that don’t require them to meet Appendix Q of the ATR rule.