“With new mortgages down 47%, US lenders are starting to go bankrupt — could this one factor trigger the worst surge of failures since 2008?”
December 20, 2022
“…A report from ATTOM reveals that new mortgage originations were down 47% in the third quarter of 2022 compared to the year before. That’s a 19% decrease from the previous quarter and represents the biggest annual drop in 21 years. And while the chill in the market affects all lenders, non-bank lenders — especially those who deal in NQM — are bearing the brunt of it…
NQMs use non-traditional methods of income verification and are frequently used by those with unusual income scenarios, are self-employed or have credit issues that make it difficult to get a qualified mortgage loan.
They’ve previously been touted as an option for creditworthy borrowers who can’t otherwise qualify for traditional mortgage loan programs…
…The NQM share of the total first mortgage market has begun to rise again: NQMs made up about 4% of the market during the first quarter of 2022, doubling from its 2% low in 2020, according to CoreLogic, a data analysis firm specializing in the housing market…”
https://finance.yahoo.com/news/mortgages-down-55-us-lenders-100000026.html
NQM make up 4% of the market? This article is a little over dramatic. Even if all 4% fail if that was enough to tank the market, the market had a bigger problem to begin with in my opinion.