Mark Fair, an associate vice president and senior portfolio manager at Venerable, a life insurance company, said he’s “very constructive” on the non-QM market.
“Modernizing and providing more clarity on structuring marketing services agreements and affiliated business arrangements and making it easier for lenders to market digitally to consumers would spur greater competition, increase consumer choices and lower settlement costs without compromising core protections,” Bob Broeksmit, president and CEO of the MBA, said in the trade group's white paper on RESPA reforms.
Attendance at the ABS East conference hit another record this week, with investors showing strong demand for structured finance products. Issuance is expected to remain elevated, helped by interest rate moves.
Issuance of MBS with non-qualified mortgages is growing even as insurance companies increase their purchases of non-QMs as whole loans. Investor demand for the products looks likely to remain strong.
Issuance of vehicle ABS is nearing another record and spreads remain tight, indicating that there’s plenty of investor demand for the asset. There are some concerns about performance, particularly for subprime auto ABS.
Mortgage originations typically decline from the second quarter to the third. This year, however, declining interest rates helped increase refinance production and prop up purchase-mortgage lending.