The 3rd Annual Non-QM Forum : An Event Summary

A roundup of select sessions convened during the 3rd Annual Non-QM Forum.

EVENT OVERVIEW

With the rest of the mortgage industry shrinking, non-QM lenders are doing better than ever by catering to borrowers who were the rejects of the market because of low credit scores, heavy debt, or their status as nonsalaried workers. The non-QM market has grown substantially since experiencing a blip during the pandemic.

IMN returned with its 3rd Annual Non-QM Forum with the opportunity for non-QM key players to learn, interact and grow. This forum was been designed to focus on both the loan origination and investor perspectives diving into the current market trends, updates, and critical issues through various panel discussions hosted by industry experts. 

This event was attended by:

• Mortgage bankers
• Private lenders in the non-QM space
• Warehouse lenders
• Underwriters and arrangers
• Legal counsel
• Rating agencies
• Mortgage servicers
• Regulators

Vaultedge has been in the Non-QM market for some time. And this event was the perfect platform for us to gather knowledge and understand the forthcoming trends in this segment.

REPORT SUMMARY 

The report highlights the key takeaways from a few selected sessions held at the 3rd Annual Non-QM Forum.

We have included a snippet of the top seven panel discussions that talk about the aftermath of the pandemic, the headwinds, and green shoots, adapting technology to make the mortgage process quicker, the future of underwriting, and what awaits the mortgage industry.

• Headwinds vs. Green shoots: The Post-Pandemic Economy & Non-QM Market Drivers
• Adapting New Processes & Tech To Make The Mortgage Process Quicker & More Efficient 
• Underwriting, Pre-Qualification, Calculating Bank Statement Income & Ability To Pay: How Is Your Credit Box Changing As Rates Rise?
• Compliance: How Are Your Guideline Changing With The Market?
• Keys To Selecting Your Non-QM Loan Lender: The Broker/Correspondent Executive Panel
• The Future of Non-QM Industry

Session 1
Headwinds vs. Green shoots: The Post-Pandemic Economy & Non-QM Market Drivers

The pandemic has caused havoc on all sections of life. The mortgage industry is slowly recovering from its aftermath. The session aims to highlight the factors that are slowing down the growth, causing negative effects on profits and revenue versus the positive aspects that are contributing to the economic recovery after the disaster.

Moderator:

‍Panelists:

1.1 Topics discussed:

• An update on the GSE changes for jumbo and second home mortgages
• Small business owners and gig economy workers… Do you expect this demographic to grow? What is the impact on residential, business purpose and bank statement loans?
• Refis: How low can they go?
• Home sales, prices and competition from single family rentals
• High growth and inflation… What will that mean for the market?
• Impact of work from home on mortgage origination
• Mo’ products mo’ problems?
• What is your favorite demographic as the Refi fades? What are the keys to targeting and educating different consumer demographics including minority and underserved markets?
• Foreign nationals: Where are they coming from?
• Incomes and FICO scores

1.2 Highlights:

• The Federal Reserve Bank of Atlanta publishes  a publicly available tool called the Home  Ownership Affordability Index which tracks the housing affordability factor in all the major counties across all the markets. The housing affordability index gives a purview of the current trend of the housing market. 
• There has been a pullback and demand witnessed as a direct response to housing affordability as the rates and home prices have reached record levels. 
• In the context of housing affordability, it looks at what income the household can afford given the current interest rates. According to Domonic Purviance, Federal Reserve Bank of Atlanta, the share of income required to afford the median-priced house given the current interest rate and cost of housing jumped to 30 over 35% nationally. 
• There is a shortage of housing. The Federal Reserve Bank of Atlanta has tracked a considerable increase in new home construction. However, the demand and supply of housing availability don’t tally.
• Dominic believes there will be some moderation in price appreciation. There won’t be any significant decline in home prices just because the inventory is low, but it’s not beyond the realm of possibilities. 
• Traditionally owning a house in low-cost areas such as Nashville, Atlanta, Tampa, Orlando, and Jacksonville didn’t require more than 35% of the owner’s income for a mortgage. What has happened now is people from high-cost areas such as New York move to low-cost areas and are able to pay the escalated price. This has hit the graph of client affordability extensively. 
• Pertaining to volumes, the non-QM sector has seen a decent rise in 2022 with $20 billion in issuance. $13 billion in the first quarter and $7 billion in the current quarter with one or two more to go before the quarter ends. 
• With the agency refi volumes decreasing has created opportunities for the originators to concentrate on the other product set as well. 
• For a securitizer anything that looks right will accompany a long duration and credit requires more enhancement from a rating standpoint. It will cost more to securitize. 
• The market generally tends to concentrate on lower LTV (Loan-to-Value), and higher FICO scores but sometimes fails to underwrite better. 
• J.P. Morgan is a late entrant to the non-QM space. Sean Walker from J.P. Morgan believes that the volume will go up to $40 billion as the year ends. The organization is busy financing securitizing non-QM assets and revving up its whole loan basis by trading certain non-QM assets. 
• There is a strong inclination towards the DSCR product for obvious reasons; there aren’t too many regulatory concerns attached to it.
• The ADU space in California might witness a new assembly bill to be passed that would tax the fix and flip individuals 25% or so at the exit. However, the bill hasn’t been sworn in yet. 
• California has a housing issue. The ADU opportunity can help them earn a separate income from renting the space out, which in a way helps improve the housing situation there. 
• Lenders have to figure out a way to finance these ADUs. Airbnb, and VRBOs are claiming the market. These rental avenues perform better in short-term periods than the typical vacation spaces in the long term. Lenders have to leverage them and build them into credit boxes. 

1.3 Conclusion:

There’s no doubt that non-QM is more difficult to originate than conforming or government loans, so many mainstream lenders, brokers, and loan officers have been reticent in the past to offer these products.  But, in the past few years, things are changing. Most non-QM lenders have understood the pulse of this gig economy. A self-employed borrower who, for example, receives tips as income as well can supplement this income data on their bank statements if they can provide proof. The idea is to make non-QM lending expandable and flexible, producing a borrower who can perform when the loan is finally made.

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Session 2
Adapting New Processes & Tech To Make The Mortgage Process Quicker & More Efficient

The mortgage industry has been viewed as a languid, paperwork-intensive industry but a stack of tech-driven innovations is changing this. These have the capacity not only to make the experience more pleasant and efficient for the loan originators, and lenders but also entirely change how borrowers buy their mortgages.

Moderator:

   Panelists: 

2.1 Topics discussed: 

• What are the keys to increasing investor/market acceptance of automated underwriting?
• Approaching regulatory/ATR considerations regarding automated underwriting, decisioning, or closing
• How are you closing loans faster?
• Everything “E” including e-closing, e-docs
• Automating the bank income statement process

2.2 Highlights:

• In 2017-2018 it was a time to compete in the market for digital supremacy. If a business had a POS, they were in the digital mortgage race already. Technology, as Katherine Campbell, Chief Digital Officer, Assurance Financial Group, LLC said can dramatically improve the capabilities of the process instead of just being implemented. 
• Certain processes require human intervention and it becomes almost unimaginable to work without a human to perform that specific task. In such scenarios, automation is the key problem-solver. 
• Instead of keeping underwriters engaged with reviewing stacks of documents, technology can empower them to make more cerebral decisions, such as determining the creditworthiness of the borrower. Taking a judgment call. 
• Nathan Knottingham shares that the consumer should be made ready for what is about to arrive, technology-wise. The consumer should be educated about what needs to be done in terms of mortgage loans. Technology needs to be flexible to adjust to the unique programs and guidelines. David Wieczorek, Director of Product Management, MeridianLink says that technology should be flexible with open APIs that can integrate easily with other TPO portals, and other PPEs to make your life easier. 
• Technology should work for the underwriter’s benefit too. For example, when it comes to scrutinizing bank statements, it’s tedious work. So, a tool that can help ease the underwriter’s burden as well as provides actionable insights and let them know that the borrower qualifies is what is needed. 
• Lack of standardization can become an impediment to the adaption of technology. The technological milestones that the mortgage industry has witnessed so far, have been around for quite some time. The issue lies with adoption. Both the parties, lenders, and borrowers have to work in tandem. 
• With technology making strides in the industry, pricing engines and adult-care facilities being considered as a property type are certain niches that will be explored soon. 
• Tech providers have been helping lenders with OCR solutions, AUS, and analyzing loan document solutions to make their lives easier. The concept of automation-as-a-service is cropping up with frenzy. These tech providers also help lenders outsource a part of their operations-their processes, lock desks, and even underwriting on a contractual basis. 
• This outsourcing of services can enable the lenders to cost-effectively expand their product line that they might not necessarily possess the in-house expertise or perhaps the bandwidth to handle.
• Reverting to standardization, the panel agreed that non-QM lacks it and that’s what gives its unique attribute. To create a level of standardization, one needs a huge pool of performance data, assess them and find out the commonality of how the loans perform. Based on the similarities of well-performing loans, a standardized feature can be enabled.
• One of the challenges that a lender faces is the lack of standardization that makes it difficult for the ones that are targeting non-QM to create seamless workflows or sets of screens to help the loan processing task accelerate.

2.3 Conclusion:

Technology in the non-QM segment needs to maintain a balance between standardization and flexibility. Identifying the challenges and creating solutions with the aid of a robust tech stack is essential. However, lenders have to bear in mind that when they decide to transition underwriters from the agency, who are used to DU, and LP to non-QM, they are educated with the norms of underwriting in the sector. For instance, we know that a plane can be flown on auto-pilot but that necessarily doesn’t mean that you will put a licensed scuba diver to man the plane? It’s a similar situation to getting individuals adapted to the technology in the non-QM industry. It takes a bit of education, persuasion, flexibility, and psychology to make it work.

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Session 3
Underwriting, Pre-Qualification, Calculating Bank Statement Income & Ability To Pay: How Is Your Credit Box Changing As Rates Rise?

How important is underwriting in the whole loan process? Underwriting is almost like a gatekeeper, a foundation on which everything is based. The panel aims to reflect on changes that are being observed in the sphere of underwriting. And how technology, such as AUS can be optimally utilized to increase an underwriter’s productivity.  Along with how interest rates have changed the credit box as it were. 

Moderator:

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‍Panelists:

3.1 Topics discussed:

• How useful are borrower FICO scores today in predicting loan performance success?
• Is fraud becoming a problem?
• Have you voluntarily adapted anything from the CSFB Non-QM rules?
• As rates rise and the economy improves …
• Reserve asset calculation
• Underwriting turn times and how are you improving underwriter productivity
• The latest AUS features you should add
• Underwriting delegated vs. non-delegated loans
• What are you asking for borrowers that you believe should be sunsetted?
• Credit ratings, income, and asset standards: How are yours changing?

3.2 Highlights:

• The rising interest rates have caused disruption in the refi market space. Higher demand with non-QM lenders. Fewer avenues for the non-agency borrowers so they have to turn to esoteric non-QM types to get loans.
• Customer expectations have changed. Over the last couple of years, it's been the concept of pushing a button to get the money that’s been on the rise. Younger borrowers, their expectation is to go online, give information, and get the money. The worst possible answer that one can say to them is to wait for 30-40 days and we’ll get back to you. 
• Providing information online is more secure now than what it was a few years ago. Customer expectations have changed following the norm of immediacy. Lenders have to maintain their reputation. It can no longer be ‘we’ll get back to you in a few days’ modes anymore.
• FICO scores are pertinent in determining future loan performance in the mortgage industry. There are a few different types of FICO scores but there seems to be a disparity in what is the accepted number. FICO was created to be a guide, to predict the likelihood of default and soon enough the evolution of the FICO score began. 
• FICO scores cannot be considered as set in stone, the whole truth. For instance, if there is a high-cash client who comes in and his FICO score is within the acceptable limits because he isn’t utilizing the credit scores. This necessarily doesn’t elude the fact of him being a high-risk borrower. There are other factors that need to be considered apart from FICO scores.
• Bank statement product is commoditized to the point and widely accepted that it meets ATR requirements. However the challenge with business bank statements is graver than personal bank statements where there are questions pertaining to the borrower’s access to the cash flow, are they the sole proprietor or they have partners, and so on. 
• Trended data have consumers use their credit cards over time and can be categorized into two types- the ones who carry three or four credit cards, use them, carry balances to a limit with the bouncers rising, and the one who uses credit cards and pays off every month and do not carry balances.  And those two people could have the same FICO score. The bad news is, that trended data is not available on FICO scores and have a significant effect on delinquency scores. It also doesn’t include the activity around credit use.
• Fannie Mae has been using trended data along with credit scores since 2016 it makes big difference. It affects delinquency rates, prepayment rates, and recovery rates. It can affect two people with the same credit scores as in the aforementioned point. One who has maxed out credit cards and balance will have a lesser chance of recovery than the ones with lesser credit cards and no balance.
• FICO and Vantage scores are trying to incorporate trended data into them. And at some point in the future, this will be the new standard. There is a whole gamut of data beyond these scores that big enterprises are evaluating and using. So, if a business isn’t under the purview of the GSEs might have a chance of not using the whole ocean of data.
• Probably in the next few years in agency lending, bank statement lending will be the next repository to obtain credit data. Although it is a mess, organizing it is something that enterprises have to utilize. Also, the next-next big thing can be using telecom information, especially for first-time buyers. Their payment history, credit-card scores, and the data field is there and can be used by lenders.
• Obtaining data for a borrower isn’t going to be restricted to credit scores anymore, the panelists feel that an OTT bill or phone bill can predict your creditworthiness as well.
• The biggest challenge that the non-QM sector could face is perhaps the lack of analysis while working with borrower data. Lenders when faced with large deposits in an unqualified income stream do not analyze the monthly income stream on the bank statement. It often just lands up being a check in the box.
• Underwriters need to be a little more open to evaluation and make necessary adjustments to be able to justify the income stream over the given period of time.
• Fraudulent activities are on the rise given the fact that where there is money, there has to be the existence of deceitful entities. And with this gig economy and a plethora of self-employed borrowers, the activities have surged. Most often, unfortunately, certain self-employed borrowers tend to disclose partial income data and omit certain charges on their bank statements. Such cases highlight the importance of reading through the data a bit too carefully on the loan documents. Something that an underwriter needs to do. If there is even a slight hint of mishap, the underwriter needs to dig deeper to find out the truth.  
• Fraudsters are a step ahead. What could work is cross-source validation of data. So, a look at the borrower’s deposit history, payment made at a coffee shop even could unravel the whole story.

3.3 Conclusion:

The panel ended the discussion agreeing that technology, best practices are being used to make humans more effective. There is a reason why lenders now have Data Scientists in their arsenal. In the case of non-repayment of loans, the lenders can do a retro-analysis, trace their steps and find out what went wrong. Data is everywhere and the wise prerogative would be to utilize this data with the help of technology. Lenders can get AI running the files automatically, highlighting anomalies, and take an action on the oddity immediately. 

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Session 4
Compliance: How Are Your Guideline Changing With The Market?

The focus of this discussion is to understand how a robust compliance function and framework can be quantified. It is not easily ascertainable as revenue targets and loan origination numbers but the extent that an effective oversight can prevent class action lawsuits, individual civil lawsuits, civil money penalties, and regulatory enforcement actions. The ultimate goal should be to employ a proactive compliance program that benefits the bottom line.

Moderator:

Panelists:

4.1 Topics discussed:

• What should an automated compliance solution have been present?
• As the space continues to grow are there more fraud attempts? What is their nature?  
• What do asset management and investor compliance officers look for?
• Preparing for October 1
• How does your underwriting system ensure compliance?
• HMDA, Fair lending, ATR/QM, and CECL: What are the pain points?
• What are the biggest compliance risks you are dealing with? What are the newest ones that you are paying attention to?

4.2 Highlights:

• The revised general QM role that was previously delayed due to the pandemic was supposed to take effect in July 2021. But the mandatory compliance State has pushed it further to October 1st.
• Due to the delay, lenders will have an option of complying with either the revised general QM definition or the original DTI-based general QM definition on applications received on or after March 1st but before October 1st.
• This delay will also provide the lenders with a third type of QM which is a temporary GS patch QM for a longer period. So, under the final rule of the GSQM loan definition will expire on October 2022 or on the date the applicable GSE exits conservatorship whichever comes first.
• This occurrence will shift away from the 43% DTI, the kind of calculation that’s more focused on loan pricing kind of criteria. 
• One of the challenges that businesses may face with the changes in ATR norms is that even though the modifications are partially good for the business with being wary of the compliance, noticing red flags and all, the training of loan officers can be slightly difficult as they haven’t adhered to the ATR norms, let’s say for the past 13 years.
• The CFPB has announced that they are going to increase enforcement and they will cover types of consumer loans and as such have targetted specifically a couple of lenders in the past when they were found in violation.
• The CFPB publishes a list of supervisory highlights quarterly that proves to be quite insightful. It's a kind of a benchmark in terms of the specific concrete actions and practices that the CFPB is taking against any kind of violation.
• Most enterprises have internal controls and procedures in place to ensure that regulations are followed diligently. These firms are always on the lookout for identifying loopholes in their processes that will help evade penalties in case of any breaches. And it’s not just about regulators, such firms are also susceptible to civil attorneys on a global basis as well.
• There are different types of strategic approaches companies take to tackle when questioned by regulators. Companies have the option of basically providing responsive materials that go above and beyond and the strategic rationale is when you provide more to the regulator it makes it difficult for the auditor to pinpoint any issue.
• The downside is that the regulator can become upset with the information overflow. It could come off as the business is trying to obscure the auditor in terms of what is being asked. Another strategic approach can be to give them what they want. This is less taxing for the stakeholders who are trying to put together the repository of information. However, in such cases, the disadvantage is that the pain points can be easily spotted by the auditors.
• Enterprises like Nationwide Property & Appraisal Services take a stern approach to their internal procedures. Especially when it comes to post-closing, they examine each step with a magnifying glass because a lot of flaws on the loan files can be spotted when examined carefully and they have 30/60 days cure period to rectify these mistakes. They usually do an internal audit and send the loan files for validation to a third party for the second round of review to spot any misses.
• Using robotic automation and AI can help reinforce the compliance management and framework. Infinity IPS uses automation for compliance that allocates complaints officers to monitor systems and endpoints for compliance issues. 
• In real-time this feature should include data management, which combines sensitive data and evidence collected for reporting compliance mapping maps and utilizes compliance controls in systems.
• Automation helps automate manual tasks such as risks, assessments, alerts, and notifications simplifying compliance workflows and reducing process repetition. 

4.3 Conclusion:

As non-QM loans fall on the higher risk bracket, non-QM lenders have to optimize process efficiencies in order to reduce bad loans and defaults. And become more prudent when it comes to auditors and compliance. Applying Machine Learning, with human-in-the-loop (HITL) management, can create better results than manual review, resulting in stronger underwriting.

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Session 5
Keys To Selecting Your Non-QM Loan Lender: The Broker/Correspondent Executive Panel

It sounds very simple when it comes to choosing the right Non-QM lender, go with the best. But who is the best and how do you judge a lender is the best in a market filled with a myriad of options? With the rising interest rates and shrinking agency space that is cutting down the volume that many businesses need to bring in every month, there rises a need to make a wise choice of choosing the right Non-QM lender.

Moderator:

Panelists:

5.1 Topics discussed: 

• Should you choose more than 1 Non-QM lender?
•  What kind of tech tools should you look for?
•  How extensive does the product line need to be?
•  Should you go with a smaller or bigger player?
•  New and existing client support
•  Payout structures for you and your team
•  Keys to a long-term relationship
•  Choosing a QM vs. Non-QM lender
•  Depth of product line vs. sharpshooters

5.2 Highlights: 

• Consistency and agility are two important aspects that businesses look for in a lender. The relationship with the lender/counterparty also matters. Choosing the right Non-QM lender doesn’t depend on who does what best but the factor of being personally invested in the collaboration plays a significant role.
• The bonding element plays a crucial part as it spills over to the way the borrower is treated in the end. The borrower ceases to be a loan number and the quintessential goal of every business to provide a delightful customer experience comes into fruition.
• Also, diversity or product variety in the various kinds of programs that the lender has is important too. If for instance the lender operates in two different cities or states and can provide a wide range of programs for clients who need a bank statement program or a real estate program, they will be approached for collaboration than the best lender in town who might not possess the range of programs.
• To enter into a partnership with a Non-QM lender with confidence, it is important to know whether the lender has your best interests in mind or not. Not only that, but you need a lender who is easy to work with and will be prudent to the time-sensitive nature of Non-QM loans.
• Lenders have to keep on updating the guidelines to remain competitive almost regularly. The Non-QM landscape is changing quickly and being connected with capital markets helps them and their counterparties to remain in the competition.
• Being transparent, and having an open door policy is another trait that businesses look for in lenders. If there is an absence of good communication, and good relationships it becomes difficult to work towards a common goal.
• Craig Chang feels that pricing is not the deciding factor always. It's based on knowing your investors, the service, and the speed with which the lenders pick up the loan and roll with it.
• Houtan Hormozian added that no matter how great the pricing is if the loan isn’t closed, the efforts are wasted. So consistency is the operative word here. Of course, pricing is one of the essential cogs in the machine of loan processing and no one wants to be one or half percent behind their competitors but at the end of the day, all that matters is whether the loan was delivered in the right manner. 
• A loan processing activity has a lot of moving parts. There is the borrower, broker, rental agreements have to be signed, and data has to be validated. All these parts work against a deadline. So, if a lender fails to deliver what was promised, he will earn a bad repute. 
• A lot of lenders are going out of business. Yet, there are some who are making it bigger. A smart move will be to collaborate with the ones who focus on your growth as well by proving ample resources, and programs. 

5.3 Conclusion:

Most Non-QM mortgage lenders are different. In fact, some offer much better terms or prices than others. Non-QM lending like its counterparts is complicated as there are several moving pieces. The application and approval process is time-consuming and, in some cases, confusing.  There are various types of loan terms and rates that differ from lender to lender. Origination fees, such as title and closing costs, also impact the overall cost of the loan. Considering all these elements, when making a large investment and entering a legal agreement for significant money borrowed, the choice of a reliable lender becomes paramount. 

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Session 6 

The Future of Non-QM Industry

Non-QM caters to investors and everyday borrowers who couldn't meet the tight underwriting standards that followed the 2008 housing bust, as well as to the self-employed. Now, as the rest of the mortgage industry going through turbulent times, these non-QM lenders are doing better than ever by assisting borrowers who were considered outcasts of the market because of low credit scores, heavy debt, or their status as nonsalaried workers. What the future looks like for the non-QM? Are there any major changes in terms of regulations, or technology, if so then what is the plan?

Moderator:

Panelists:

6.1 Topics discussed:

• What kind of products are you looking to add to your arsenal?
• Cryptocurrencies, non-fungible tokens, and metaverses 
• Commercial-focused opportunities
• What do you think might come down on the regulatory side?
• Latest technology additions
• How much of your business is virtual? How much will be in 3 years?
• Work from home impact
• How relevant is credit going forward?
• Can you project market size for Non-QM over the next 12, 24, and 36 months?

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6.2 Highlights: 

• The Non-QM market is currently focussed on SDR products and Fix and Flip services. These have the potential to grow immensely. These entities will be going after a lot bigger institutional borrowers that have large portfolios of homes. With regards to Fix and Flip, they can repair homes that have been destroyed by meteors but the foundation remains intact they can create a home for anyone.
• ADUs are another area of interest for the non-QM market. Having an accessory dwelling unit (ADU) on an existing property has become a widespread way for homeowners to provide independent living space to family members or to gain residual income by renting out the unit. This rage has increased the demand for home financing that offers special consideration for an ADU.
• People have become cognizant of the crypto-verse and NFT and certain companies have started taking crypto as tokens. Yet they have to prove their worth in the non-QM market. Whether they can be accepted as down payment, for reserves, asset utilization; the answer is yes. However, there is a lot of volatility attached to them.
• It is a kind of store capital and a prudent lender is going to employ it as an equity-based loan and not use the whole amount for any type of calculation for the reserves but perhaps a portion that they are comfortable with.
• It is difficult to write down the guidelines around something that is so volatile and changes on a daily basis. It can be easily used for down payments but the non-QM industry has yet to venture into this realm further.
• The ability to repay is something that could go under modification. There might be more guidance available or ways to calculate the ability to repay. Most people can repay the amount but are afraid to take certain steps because of the regulatory actions and such. So, on the regulatory side, there will be more focus on ATR.
• The latest buzzword around the non-QM town is automation. It's not about automating underwriting approvals but the document review process. Mortgage automation companies focus on their OCR capabilities to read through loan packages and identify, index, and calculate the borrower’s income data.
• The virtual working pattern has companies live online. You have half of the staff on the road or in the office and the other half working from home or wherever it's feasible. Technologies like Google Meet or Zoom have enabled this virtual working environment that saw a significant rise during the pandemic times and even after that. 
• Virtual is here to stay. However not every job role requires an online presence. For example, an underwriter can learn more about the process by sitting in a cubicle wrapped in conversations regarding a particular loan file. However, it entirely depends on the companies and what they are comfortable with. Whether they go fully remote or follow a hybrid pattern is for them to assess.
• Most companies are making it mandatory for employees to be on Zoom from nine to five to build on the camaraderie that is lost while working from home. While for Account Executives or salespeople who work outside the office this virtual setting isn’t the foreign territory. However, now you have production staff who are now being asked to work remotely.
• This type of setup comes with its own set of challenges. There are training challenges, and cultural challenges and unfortunately, there are people who try and take undue advantage of the situation. From an HR perspective, installing auto clickers can help people stay online.

6.3 Conclusion:

The size of the non-QM market for 2022 is probably going to end up roughly around $40 billion dollars and half of it is already been originated towards the first part of the year. In the case of the DSCR portion, the opportunity to grow is immense. The housing market post-covid is around $50 trillion and 20% of it give or take is owned by investors. Let’s say ten trillion dollars are owned by investors, 90% are owned by uncertified landlords and there is the existence of the untapped equity, sitting ready for a loan. As the world grows more digital, non-QM is going to witness a lot of entrepreneurial borrowers who have TikToks, YouTube profiles, and are influencers and this number will increase. How non-QM can cater to the needs of the new generation of borrowers amidst the technological advancements, virtual working ecosystems, cryptos, and the like will be an interesting and insightful sequence of events.

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About Vaultedge

Vaultedge is the most advanced intelligent automation software that uses AI & OCR to automatically review loan documents, analyze income, file them into correct folders and cross-check the data in the documents with your LOS (Encompass, Black Knight) or mortgage servicing systems. Our products, the Vaultedge Mortgage Automation (VMA) and Vaultedge Income Analyzer (VIA) have been designed keeping the modern lender, servicer, and investor in mind. They have been innovated to speed up the loan boarding and closing process.

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