During the 2008 financial crisis, investors in non-agency MBS sought repurchases from issuers, citing faulty underwriting and disclosures. A similar surge in putbacks could be on the way for the auto ABS market.
Angel Oak Mortgage Solutions laid off roughly 70% of its 275 employees as non-QM originations have stalled due to economic fallout caused by the coronavirus.
Digital mortgage closings are getting renewed attention with the industry forced into social distancing to contain the coronavirus. Remote online notarization can help, though it’s not allowed in all states yet.
The bulk of lenders operating in the non-QM market have suspended production due to a lack of demand in the secondary market. There are some signs that originations could resume within weeks.