September Market Advantage: Rates, Non-QM, and Secondary Trends

In this episode of Optimal Insights, the team reviews the latest mortgage market developments before diving into September Market Advantage data. The market update examines the recent fixed-income selloff, Treasury yields, upcoming inflation reports and the interest-rate environment, along with geopolitical developments that could influence energy markets and inflation.

The September Market Advantage discussion highlights how higher mortgage rates and seasonal purchase trends affected lock activity and product mix. The speakers examine the continued strength of non-QM lending, growing use of second-lien products, increased adjustable-rate mortgage activity and changes in average loan size. The conversation also covers secondary marketing trends, including mandatory spreads, loan-sale execution, mortgage servicing rights, specified-pool eligibility and shifts in hedge composition.

A key theme throughout the episode is how mortgage market participants are adapting to a challenging rate environment, including increased activity in non-QM and home equity products and an ongoing focus on execution as margins remain tight.

Optimal Insights Team:

• Alex Hebner, Hedge Account Manager

• James Cahill, MSF/MSR Account Manager

• Mike Vough, SVP, Corporate Strategy

• Brennan O'Connell, Director of Data Solutions

Production Team:

• Executive Producer: Sara Holtz

• Producers: Matt Gilhooly & Alex Kreuter

Commentary included in the podcast shall not be construed as, nor is Optimal Blue providing, any legal, trading, hedging, or financial advice.