A number of lenders have introduced new non-agency products with looser underwriting guidelines in recent weeks. Rocket and United Wholesale offered jumbos and Deephaven widened expanded-credit products.
Jumbo lending increased a scant 2% in the fourth quarter and held steady on an annual basis in 2020. The sector lost a significant amount of market share as agency refi business boomed. (Includes data chart.)
In the span of two days, Chase offered a first-of-its-kind risk-sharing transaction involving non-qualified mortgages and two prime non-agency MBS, including one with a balance of $1.10 billion.
The volume of jumbo servicing handled by 30 of the top firms in the sector declined by nearly 6% in 2020. The share of borrowers missing payments is increasing. (Includes data chart.)
Non-agency forbearance increases; personnel moves at Deephaven, Wells Fargo and Quontic; new non-agency MBS; a jumbo mortgage symposium; PCMA loosens standards for jumbo product.
Wells Fargo is once again buying jumbo mortgages from correspondents. Meanwhile, newly minted public company United Wholesale is set to resume originating the product through brokers.
The non-agency residential lending unit and business purpose lending arm are projected to earn returns greater than 20% this year. Still, Redwood took a large loss in 2020 due to volatility from the coronavirus.
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