Non-QM is hotter than ever, even as other sectors of the mortgage market continue to trend lackluster these days. To much fanfare, National Mortgage Professional’s newest season of Non-QM Town Hall kicked off with its first session in June.
Moderated by American Business Media Head of Outreach and Engagement Andrew Berman, the panel features Tom Davis, chief sales officer at Deephaven Mortgage, Tom Hutchens, EVP of Production for Angel Oak Mortgage Solutions, and Aaron Samples, chief revenue officer of Logan Finance Corporation.
The consensus among panelists during their latest event was that opportunity in the Non-QM space is boundless and still largely untapped.
“In the time I’ve been involved in securitizations and the Non-QM space, it’s about as liquid as I’ve ever seen it,” Samples pointed out. “Securitizations are very strong; these spreads are very tight; there’s really great investor demand in the securitization market.”
Amidst the candid conversation, these Non-QM leaders hailed new technology and its ability to streamline operations across the space.
“We’re using technology to make it more of an efficient process for the broker and to lower the cost to manufacture,” Davis said. The process of originating bank statement loans in particular has really benefited from these advancements. “The number one product in Non-QM is bank statement loans,” he added. “There’s over 18 million self-employed people in the United States, that account for 30 million businesses.”
LOs who previously only did government loans are now recognizing that they can’t ignore the non-agency space, since it’s become central to borrowing. “Even in the short 10 years Non-QM has been around, it’s evolved to include great products and programs,” Hutchens said. “You can’t be the person that can only originate agency and government loans; you’ve got to be able to offer these.”
In terms of the future, the outlook is generally positive, welcoming continued growth and more widespread adoption of these products.
“We probably outpace in terms of percentage of growth agency business, even as rates rally,” Samples said, going on to add, “The broker community has adopted Non-QM far better than the big retail community. I think a lot of the big retail originators are waking up now and realizing they’re behind the curve and in fact they’re losing LOs at a record pace over to the broker side.”
Consistent education and training are vital to market expansion, the panelists agreed. After all, only about 10% of licensed LOs have done Non-QM loans.
“We’re in the education business,” Davis said. “We’re doing 80 to 90, 100 webinars a month. It’s amazing that a lot of originators still don’t know about these products, still don’t know where to find these borrowers.” The panel will continue this education later this summer, with more webinars scheduled.
The next event in the series is Serving Business Owners, set for Tuesday, July 16 at 2 p.m. Then, Helping Real Estate Investors will take place on Wednesday, August 7 at 2 p.m. Register to attend at NMPlink.com/NQMTH.
