Tom Hutchens, executive vice president, production for Angel Oak Mortgage Solutions
, appeared on the May 18 episode of the Mortgage Leadership Outlook series
. Hutchens chatted with host Andrew Berman, head of engagement and outreach for National Mortgage Professional
magazine, about the COVID-19 pandemic's impact on his company's business, the non-QM space, trends he's seeing in the market and more.
Hutchens has more than 18 years of experience when it comes to leading sales for a wholesale and correspondent lending platform. Before joining Angel Oak, Hutchens was a senior sales leader at SouthStar Funding and was responsible for the firm's business and sales development across the country.
Hutchens shared his positive outlook on the non-QM business, which was has been hit hard by the COVID-19 pandemic. He assured viewers that Angel Oak is here to stay and it still plans on originating loans in the non-QM space.
Highlights From The Interview With Hutchens ...
►“We were just on an awareness and education campaign,” said Hutchens when asked how Angel Oak got started in the non-agency space. He said lenders weren’t designed to give every deserving borrowers a loan. When they were able to show how good these loans performed, the non-QM business began to take off.
►“During all of this craziness that the whole country has experienced over the last couple of months, our commitment to the space has not wavered.” Hutchens said that this collapse wasn’t credit-driven. “The difference between non-QM and QM loans is with QM loans, their performance is guaranteed. Non-QM loans, that’s private capital, so there is no government guarantee of performance.” As states began shutting down their economy, it became impossible for non-QM lenders to determine and evaluate credit risk. Without being about to determine credit risk, they weren’t able to originate loans.
►“Before the pandemic, we were issuing securitizations every other month and we expect to be back there in the near future.” Angel Oak is currently using a bank statement loan product. It explores the borrower’s bank statement to determine the ability to repay the loan.
►Hutchens said that his team responded as it started to see states open up their economies. He says that the worst of this is likely in the past and Angel Oak is still looking to fulfill its mission to serve the underserved borrower.
Check out the full discussion between Hutchens and Berman below.