Investors are flocking to non-QM MBS and losses on the deals have been essentially non-existent. However, some large firms continue to hold out for better protections.

Some are calling for the GSEs’ automated underwriting systems to be used after the QM patch expires to determine whether a mortgage is a QM.

Brian Herr of Medalist Partners: “Some of the more bespoke, esoteric markets won’t be so bespoke or esoteric going forward.”

Some mortgage market participants suggested the CFPB replace the DTI ratio standard with a different measure, such as a residual income test.

Annual adjustments in the GSE loan limit are required by law and FHFA regulations peg them to changes in an index of average house prices maintained by the agency. As of the most recent reading, the loan limit will easily climb over $500,000 in 2020, a threshold that will get people’s attention.