One of the most common types of non-qualified mortgages is a loan for self-employed borrowers underwritten with bank statements. Borrowers often opt for a non-QM rather than re-file taxes.

Seven non-agency MBS deals are in the market at the moment, including five expanded-credit MBS. Many other deals are also in the works.

HPS is reportedly paying about $250 million for the non-QM lender. Citadel’s expanded-credit production has outpaced the market this year.

Redwood’s mortgage banking income decreased in the third quarter as falling interest rates lessened demand for MBS. Execution rebounded in October after interest rates increased.

Moody’s assesses Quicken as an “average” originator of prime jumbos; Prosper ties up with BBVA USA to launch a HELOC product; Deephaven hires Kris-Ann Carduff as a vice president.

Wells Fargo is set to issue its second-largest post-crisis prime non-agency MBS while PIMCO has a deal backed by seasoned mortgages.

Issuers of expanded-credit MBS have significantly increased deal volume this year without reducing underwriting standards in terms of traditional credit characteristics. Average credit scores for loans in the transactions have actually improved this year.

Presale reports for nearly a dozen non-agency MBS have been published in the last two weeks, including three deals from JPMorgan Chase.

Issuance of expanded-credit MBS more than doubled on an annual basis at the end of the third quarter while deals backed by prime mortgages and GSE-eligible loans declined. The expanded-credit sector is expected to continue to grow, according to industry analysts. (Includes data chart.)