Non-QM lending may sound good to conventional originators looking to bolster their menus, but headwinds are still evident. Low-yielding paper still needs to be moved but financiers and acquirers are having second thoughts.
Weak MBS trading activity usually isn’t a good sign. To some it portends a lack of liquidity, to others cloudiness in a market that has lost its way. Regardless, daily MBS trades in May were not pretty.