The fix-and-flip market is starting to look a little long in the tooth. Right? Maybe for some corporate investors. But for originators of these short-term loans, the grass still looks green.
Profits (and profitability) drive the decision to sell a mortgage company. Several lender/servicers are at an inflection point or soon will be. In sum, the rest of 2021 should be interesting.
It’s assumed that third-quarter originations will be down compared to 1Q and 2Q, but lenders remain sanguine about the short term. Also, some are finding solace in non-QM production.
Jumbo mortgages and non-qualified mortgages can generate better margins than agency products. Still, the loans don’t necessarily offer a guaranteed path to profits.
The new standards mirror FHFA’s existing requirements in many ways, while extending the provisions to non-agency mortgages. CSBS also provided a few breaks to the industry.