Affluent, self-employed borrowers dominate the space
Hutchens said the typical non-QM borrower profile has remained consistent throughout the year to date.
“It’s staying pretty much the same. It’s pretty affluent – bank statement, self-employed borrowers,” he said. “Those average loan amounts continue to rise, and the credit quality [too]. The average FICO is over 750. So it’s a very well-qualified borrower.”
The second most common non-QM client, according to Hutchens, is the professional real estate investor tapping equity or expanding a rental portfolio. “There’s lots of investor demand, and it speaks back to the lack of supply,” he said.
“Rents are staying high, investors are finding their properties get leased pretty easily and to good tenants, for the long term.”
The Federal Reserve opted to hold rates steady yet again on Wednesday (July 29), a decision that’s unlikely to move the needle for many homebuyers who were sitting on the sidelines or waiting for a sign to jump back in.
