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Non-QM Borrower Finances Are Improving – And That’s An Opportunity For Brokers

Overall Non-QM borrower eligibility and FICO ratings have steadily improved over the last year. That’s according to Angel Oak Mortgage Solutions’ executive VP of production, Tom Hutchens. Applicants to Angel Oak’s bank statement loan programs, he said, are applying with higher FICO scores and lower LTVs, something that highlights the strength of these borrowers and the ingenuity business owners have shown in responding to the pandemic.

Hutchens explained why, despite improvements in their overall credit picture, non-QM loans remain an essential tool for serving self-employed borrowers. He explained how originators can use non-QM lending to show disheartened self-employed borrowers that the options available to them are far wider than what agency lenders might tell them, and he offered a key explanation as to why, in his opinion, these borrowers’ outlooks are improving after such a difficult year.