Is the non-QM world “a scary place right now?”

LOs, considering rising rates and lower appetite for non-QM loans, how has your production been with these products?

Good afternoon! Was this newsletter forwarded to you? Sign up here. Hello, LOs!   After First Guaranty Mortgage Corp. (FGMC) filed for bankruptcy and Sprout Mortgage shut down its operations, a capital markets executive told me: "The non-QM world is a scary place right now."    Lenders are trying to sell to investors loans originated a couple months ago, when mortgage rates were significantly lower than the current level. But investors want more premiums amid the Federal Reserve's rate hikes.    To illustrate: Non-QM primary rates went from 3.9% in January to 7% in June, according to RAMS Mortgage Capital, a broker for the secondary market.    "The non-QM market has been in shambles, dragging everyone down together: Investors and aggregators have felt the pain caused by extended durations while originators struggle to right-size current coupons and find any liquidity in this fast-moving market," said Tad Dahike, senior managing director at RAMS.    He added: "The private-label securitizations market, execution of choice for this sector, is experiencing a buyers' strike, leading to wider spreads and much higher rates. We started 2022 with AAA spreads around +150 basis points and the 10-year at 1.63% and now we are around +235 bps with a 2.9% 10-year."   LOs, considering rising rates and lower appetite for non-QM loans, how has your production been with these products? Please share your thoughts with me at flavia@hwmedia.com.   Flávia Furlan Nunes Mortgage reporter, HousingWire Mortgage application volume dips 1.7% led by decline in purchase mortgages Politics & Money, Mortgage, Real Estate  Demand for mortgages declined for two consecutive weeks, led by a dip in purchase mortgage applications despite rates on a downward trend. For too long, a reverse mortgage has been seen as a last resort At Reverse Mortgage Funding LLC, we know that when used thoughtfully, it can be a sophisticated part of a financial plan. That's why we're working to change the way people think about reverse mortgages. Learn More. Sponsored by Reverse Mortgage Funding Three steps lenders should take when selecting an eVault provider Presented by Wolters Kluwer As mortgage and capital markets become increasingly digital, most lenders, regardless of their lending strategy, will eventually need an eVault. Learn about the steps a lender should take before investing in eVault technology. VA official talks future of partial claims and revamping its reputation Appraisals and Valuations, Mortgage, Politics and Money John Bell, deputy director at the VA, said the agency has made strides in recent years to get loans processed and out the door in a timely manner. HELOC lenders can expedite valuations, mitigate risk, and lower costs From automated valuation models to traditional appraisals and everything in between, home equity products are now available nationwide. This home equity toolbox allows lenders to discover the solutions available for all their lending needs. Download the Toolbox Sponsored by Clear Capital Mortgage credit availability falls 0.3% in June Mortgage Lenders continued to tighten credit standards in June as higher mortgage rates slowed refinance and purchase activity. HousingWire, 433 East Las Colinas Blvd., Suite 830, Irving, TX 75039 Manage preferences

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