Originations of non-QMs and other expanded-credit products increased in the third quarter though not as quickly as total first-lien originations, which were boosted by refi business. (Includes data chart.)
The parent company of United Wholesale Mortgage was the top originator of mortgages in prime non-agency MBS issued in the third quarter. Underwriting standards haven’t changed much in the past year. (Includes two data charts.)
Impac is making some changes aimed at increasing originations of non-QMs after focusing on GSE refis in 3Q19. The lender’s profitability took a hit as GSE mortgages offer lower margins than non-QMs.
Charlie Clark, president of the American Association of Residential Mortgage Regulators, stressed the need to establish prudential standards for nonbank lenders and servicers.
It’s still not clear how the CFPB will address the patch for qualified mortgages, prompting speculation among participants in the non-QM market. The bureau has the issue listed on its December agenda.
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.
“The appetite in the secondary market for non-QMs is insane,” said Shea Pallante, an executive vice president at the Long Island-based Sprout Mortgage...