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.