Production of interest-only mortgages by a select group of lenders increased by more than 65% in the second quarter. Data from HMDA provides new insight on the characteristics of IO borrowers. (Includes data chart.)

Servicing portfolios at most of the major subprime servicers are shrinking, except at Citadel Servicing. The firm has more than doubled its servicing portfolio in the past year.

Activity in the non-agency MBS market is resuming after a slowdown in the second half of August. Presale reports for five deals have been published this month, led by prime non-agency MBS.

Citi joined JPMorgan Chase as the second big bank to issue MBS backed by non-QMs. The deal was stocked with mortgages from Impac.

Several real estate investment trusts, including MFA Financial and Starwood Property Trust, are expanding their portfolio of non-qualified mortgages. The loans provide attractive returns, whether retained or bundled into an MBS.

Credit Suisse jumps into the non-QM MBS market, tapping a lender that previously contributed to MBS from Western Asset Management Company. JPMorgan Chase and PIMCO separately brought innovative deals.

Originations of non-QMs by Impac fell in the second quarter as the lender increased production of GSE refinances. However, officials at the nonbank stress that non-QMs remain an important part of Impac’s business.