A number of firms are working to increase originations of non-QMs and ramping up investments in the loans. It can be a highly profitable business, though investor demand is volatile.

As an increase in interest rates curtailed its GSE refi volume, Impac is rushing to ramp up originations of non-QMs. The firm also plans to issue its own MBS.

A flurry of non-agency MBS hit the market; the number of non-agency mortgages in forbearance increases; SFA raises concerns about CFPB’s proposal to establish a partial foreclosure moratorium; SFA to set up data tape task force; Sachem Capital generates $2.2 million of net income in 1Q21; new industry hires.

The real estate investment trust also plans to acquire business-purpose loan originator Lima One.

Non-QM impairments decline; non-agency forbearance rate improves; non-agency reverse mortgage lender settles with CFPB; Redwood paying for its employees’ MI; PCMA partners with various advisors.

Goldman Sachs Mortgage Company has acquired more than $800 million of non-QMs this year and is set to issue a $291 million MBS.

Prime non-agency MBS issuance continued to flow in April, helped by some new players. Expanded-credit activity has been limited recently, with a downturn in demand.

Issuance of non-agency MBS increased by 84% on a sequential basis in the first quarter of 2021. Chase accounted for nearly a third of all issuance. (Includes data chart.)

An effort by the CFPB to delay the end of the QM patch is causing uncertainty for non-agency lenders. A coalition of lenders and consumer advocates said the CFPB shouldn’t move forward with the proposal.

The impairment rate on securitized non-QMs hit 11.1% at the end of February. At the end of 2020, the rate stood at 10.3% after months of steady improvement.