When the pandemic struck this spring, non-QM sales in progress fell apart involving some heavy hitters like NewRez. Now those loan buyers are getting sued for reneging on their contracts.
The two real estate investment trusts saw red ink in the first quarter as they were forced to sell assets when prices plummeted. MFA raised capital this week while AGMIT is considering its options.
After non-agency MBS issuance all but froze in March, issuers are beginning to return to the market. Neuberger Berman issued a non-QM MBS this week and others are working on deals as well.
Thanks to economic damage caused by the coronavirus, the non-QM market is in tatters. Yet, opportunity abounds in the junk heap. Will Citadel become a specialty/subservicer?
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