Adoption of eNotes has been limited, though activity surged in 2019 led by Quicken Loans and warehouse lenders. There are benefits for lenders willing to deal with the problems that accompany electronic processes.
Federal regulators should make changes to capital requirements that would allow banks to complete credit-risk transfer transactions similar to the deals issued by the GSEs, according to industry participants.
If a Democrat wins the presidential race, industry analysts expect regulatory changes in the mortgage industry. If Trump is reelected, GSE reform efforts will continue to gather pace.
A JPMorgan Chase official noted that Fannie Mae and Freddie Mac can complete credit risk transfer deals and nonbanks have options as well, but banks? Not so much...
Some players in the market hoped that once the QM patch expired a significant amount of originations would shift from the GSEs to the non-agency market. But those hopes are fading...